MASTER OF BUSINESS ADMINISTRATION PROGRAM MANAGERIAL ACCOUNTING 631 SPRING SEMESTER 2019 CASE No. 3 You have been asked to assist the management of...

The sales price per unit is $25.

Due to the marginal results of operations of the factory in Area C, Annahda has decided to cease operations and sell that factory's machinery and equipment by the end of this year. Annahda expects that the proceeds from the sale of these assets would be greater than their book value and would cover all termination costs.

Annahda, however, would like to continue serving its customers in that area if it is economically feasible and is considering one of the following three alternatives:

1. Expand the operations of the Area B factory by using space presently idle. This move would result in the following changes in that factory's operations: