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Alpine, Inc., has been experiencing losses for some time, as shown by its most recent income statement: ALPINE, INC.
Alpine, Inc., has been experiencing losses for some time, as shown by its most recent income statement:ALPINE, INC.Income StatementFor the year ended June 30, 2011$480,000Less: Cost of Goods Sold$120,00065,600275,600204,400Less: Operating expenses:Selling expenses:Variable:$38,40052,400110,000Administrative expenses:3,200250,600$(46,200)All variable expenses in the company vary in terms of units sold, except for sales commissions, which are based on sales dollars. Variable manufacturing overhead is 50 cents per unit. The company’s plant has a capacity of 70,000 units.Management is particularly disappointed with 2011’s operating results. Several possible courses of action are being studied to determine what should be done to make 2012 profitable.REQUIRED:1.
