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The City of Miami is about to replace an old fire truck with a new vehicle in an effort to save maintenance and other operating costs. Which of the following items, all related to the transaction, would net be considered in the decision? 1. Purchase price of the new vehicle. Purchase price of the old vehicle,-su. ot C. Savings in operating costs as a result of the new vehicle. D. Proceeds from disposal of the old vehicle. 2. Iron Mountain, which has excess capacity, received a special order for 2,000 units at a price of S12 per unit. Currently without considering the special order. Budget information for the current year follows. uction Sales Less: Cost of goods sold Gross margin $160,000 120000 S 40,000 fraed a profit Cost of goods sold include $20,000 of fixed manufacturing cost. If the special order is accepted, the company's income will Ingease 3. The condensed income statement for a business for the past year is presented as follows: Product Sales Less variable costs Contribution margin Less fixed costs Income (loss) from oper Total $300,000 $220,000 $340,000 $860,000 _180,000 90.000-220.000-590.000 $120,00030,000 $120,000 $270,000 50,000 40,000 140,000 $ 80,000 130,000 Management is considering the discontinuance of the manufacture and sale of Product G at the beginning of the current year. The discontinuance would have no effect on the total fixed H. What is the amount of change in net income for the current year that will result from the discontinuance of Product G? F 70,oco o,coo So,cco - 100,000 opco

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