operate a popcorn machine in your movie theater or to sell it?A. California tax on popcorn sales B. Cost of training courses that popcorn operators must take (it’s a tough jobC. Revenue from popcorn sales that you would no longer receiveD. Revenue from a candy display that you could put in the place of the popcorn machineE. None of the aboveWhich of the following cash flows is NOTrelevant in deciding whether to continue to
Tesla Motors currently sells one product, an electric car known as the C200. Current annualsales are 40,000 and each car has a contribution margin of $10,000. Current fixed costs are$100,000,000. Tesla is considering offering an add-on package (which allows the car to fly)for an additional fee of $50,000. A team of five engineers – each with a fixed annual salaryof $1,000,000 – will be hired to build and manage the add-on package. Additionally, directmaterial costs for each add-on package will be $30,000. Due to the publicity of offering theadd-on package, sales of the C200 are also expected to increase by 20%. Taking into account the projected increase in sales units, how many add-on packages must besold in order to increase profit by 50%?
Bird Industries produces and sells scooters. Variable cost of production is $40 per scooter; standard sellingprice is $100 per scooter. Bird currently employs three scooter makers at a total salary cost of $150,000. Current annual capacity is 6,000 scooters and can only be increased to 8,000 scooters by hiring an additional scooter maker at $50,000 per year. Bird expects to sell 5,400 scooters at the normal sales price, when Lodi Police Department proposes a special order. They offer to buy: 1,000 scooters at a discounted price of $80 each.