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Alard Company produces blenders and coffee makers During the past year the company pro-duced and sold 65000 blenders and 75000 coffee makers Fixed costs for

Alard Company produces blenders and coffee makers. During the past year, the company pro-duced and sold 65,000 blenders and 75,000 coffee makers. Fixed costs for Alard totaled $340,000,of which $184,000 can be avoided if the blenders are not produced and $142,500 can be avoided if the coffee makers are not produced. Revenue and variable cost information follow: Required: 1. Prepare segmented income statements. Separate direct and common fixed costs. 2. Whatwould the effectbeonAlard s profitifthecoffeemakerlineisdropped? Theblenderline? 3. What would the effect be on firm profits if an additional 10,000 blenders could be produced(using existing capacity) and sold for $21.50 on a special-order basis? Existing sales wouldbe unaffected by the special order.

Jun 25 2020 View more View Less

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