King Karaoke makes karaoke machines for personal and commercial use. The production manager wants to replace an old assembly machine with a newer model. He believes the new model will allow them to reduce fixed and variable costs by 8%. The new machine has a value of $130,000 and the old machine is valued at $35,000. Current sales are $600,000 with a contribution margin of 59% and fixed costs of $98,000. Average operating assets before purchase of the new machine are $4,000,000. Should the company upgrade their assembly machine? Why or why not?
A. No, because average operating assets are increased.
B. Yes, because the ROI increases by 0.52%.
C. No, because the ROI decreases by 0.15%
D. Yes, because fixed and variable costs are decreased.

Skychefs, inc. prepares in-flight meals for a number of major airlines. one of the company's products is grilled salmon in dill sauce with baby new potatoes and spring vegetables. during the most recent week, the company prepared 4000 of these meals using 960 direct labor hours. the company paid these direct labor workers a total of $19,200 for this work, or $20.00 per hour. according to standard cost card for this meal, it should require 0.25 direct labour-hours at a cost of $19.75 per hour.1. what is the standard labor-hours allowed (sh) to prepare 4,000 meals? 2. what is the standard labor cost allowed (sh x sr) to prepare 4,000 meals? 3. what is the labor spending variance? 4. what is the labor rate variance and the labor efficiency variance?