Question : 51. Neter Co. can further process Product J to produce Product : 1233927

51. Neter Co. can further process Product J to produce Product D. Product J is currently selling for $21 per pound and costs $15.75 per pound to produce. Product D would sell for $35 per pound and would require an additional cost of $8.75 per pound to produce. What is the differential revenue of producing Product D? A. $7 per poundB. $8.75 per poundC. $14 per poundD. $5.25 per pound

52. Jones Co. can further process Product B to produce Product C. Product B is currently selling for $60 per pound and costs $42 per pound to produce. Product C would sell for $82 per pound and would require an additional cost of $13 per pound to produce. What is the differential revenue of producing and selling Product C? A. $22 per poundB. $42 per poundC. $45 per poundD. $18 per pound

53. Wilson Company is considering replacing equipment which originally cost $500,000 and which has $460,000 accumulated depreciation to date. A new machine will cost $790,000. What is the sunk cost in this situation? A. $330,000B. $500,000C. $40,000D. $290,000

54. Mathews Company is considering replacing equipment which originally cost $500,000 and which has $460,000 accumulated depreciation to date. A new machine will cost $790,000 and the old equipment can be sold for $8,000. What is the sunk cost in this situation? A. $53,000B. $40,000C. $37,000D. $290,000

55. A business is considering a cash outlay of $200,000 for the purchase of land, which it could lease for $35,000 per year. If alternative investments are available which yield an 18% return, the opportunity cost of the purchase of the land is: A. $35,000B. $36,000C. $  1,000D. $37,000

56. A business is considering a cash outlay of $250,000 for the purchase of land, which it could lease for $36,000 per year. If alternative investments are available which yield an 18% return, the opportunity cost of the purchase of the land is: A. $45,000B. $36,000C. $  9,000D. $54,000

57. A business is considering a cash outlay of $500,000 for the purchase of land, which it could lease for $40,000 per year. If alternative investments are available which yield a 21% return, the opportunity cost of the purchase of the land is: A. $105,000B. $  40,000C. $  65,000D. $    8,400

58. A business received an offer from an exporter for 20,000 units of product at $15 per unit. The acceptance of the offer will not affect normal production or domestic sales prices. The following data are available: 

Domestic unit sales price

$21

Unit manufacturing costs:

  Variable

12

  Fixed

5

What is the differential revenue from the acceptance of the offer? A. $300,000B. $420,000C. $120,000D. $240,000

59. A business received an offer from an exporter for 10,000 units of product at $16 per unit. The acceptance of the offer will not affect normal production or domestic sales prices. The following data are available: 

Domestic unit sales price

$20

Unit manufacturing costs:

  Variable

13

  Fixed

1

What is the differential revenue from the acceptance of the offer? A. $200,000B. $160,000C. $130,000D. $140,000

60. A business received an offer from an exporter for 10,000 units of product at $16 per unit. The acceptance of the offer will not affect normal production or domestic sales prices. The following data are available: 

Domestic unit sales price

$20

Unit manufacturing costs:

  Variable

13

  Fixed

1

What is the differential cost from the acceptance of the offer? A. $200,000B. $160,000C. $140,000D. $130,000