Hello,EagleEye Company, a manufacturer of digital cameras, is considering entry into the digital binocular market.  EagleEye Company currently does not produce binoculars of any style, so this venture would require a careful analysis of relevant manufacturing costs to correctly assess its ability to compete.  The market price for this binocular style is well established at $134 per unit.  EagleEye has enough square footage in its plant to accommodate the new production line, although several pieces of new equipment would be required, their estimated cost is $4,750,000.  EagleEye requires a minimum ROI of 12% on any product line investment and estimates that if it enters this market with its digital binocular product at the prevailing market price, it is confident of its ability to sell 17,000 units per year.Question:Identify the costs that EagleEye Company would consider for decision of entering the digital binocular market.  (Select all that apply).1. Raw materials and direct labor2. Branch Manager's salary3. Design and Engineering costs4. Variable overhead and new fixed overhead costs.5. Facility costs.thanks...

Question
Asked Apr 14, 2019
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Hello,

EagleEye Company, a manufacturer of digital cameras, is considering entry into the digital binocular market.  EagleEye Company currently does not produce binoculars of any style, so this venture would require a careful analysis of relevant manufacturing costs to correctly assess its ability to compete.  The market price for this binocular style is well established at $134 per unit.  EagleEye has enough square footage in its plant to accommodate the new production line, although several pieces of new equipment would be required, their estimated cost is $4,750,000.  EagleEye requires a minimum ROI of 12% on any product line investment and estimates that if it enters this market with its digital binocular product at the prevailing market price, it is confident of its ability to sell 17,000 units per year.

Question:

Identify the costs that EagleEye Company would consider for decision of entering the digital binocular market.  (Select all that apply).

1. Raw materials and direct labor

2. Branch Manager's salary

3. Design and Engineering costs

4. Variable overhead and new fixed overhead costs.

5. Facility costs.

thanks... 

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