Curio Enterprises Currently Manufactures Two Products,X and Y,for Which the Following

Essay

Curio Enterprises currently manufactures two products,X and Y,for which the following data have been gathered:
*NOTE: All common costs are fixed costs,and they represent the total fixed costs for the company.
Curio is considering adding a new product,Product Z.It is expected that Product Z would sell for $50 per unit,have variable costs of $33 per unit,and that the addition of Product Z would result in one-third of the company's common costs being allocated to each product line.It is expected that 10,000 units of product Z would be produced and sold during the period
Required:
What is the total incremental income in the decision whether or not to manufacture Product Z? Explain why Curio should or should not manufacture Product Z.