Radar Company Sells Bikes For 300 Each The Company Currently Sells 3 750 Bikes Per Year And Could Make As Many As 5 00 1 (25.52 KiB) Viewed 72 times
Radar Company Sells Bikes For 300 Each The Company Currently Sells 3 750 Bikes Per Year And Could Make As Many As 5 00 2 (25.52 KiB) Viewed 72 times
Radar Company sells bikes for $300 each. The company currently sells 3.750 bikes per year and could make as many as 5,000 bikes per year. The bikes cost $225 each to make: $150 in variable costs per bike and S75 of fixed costs per bike Radar receives an offer from a potential customer who wants to buy 750 bikes for $250 each, Incremental fixed costs to make this order are 560 per bike. No other costs will change if this order is accepted. (a) Compute the income for the special offer. (b) Should Radar accept this offer? Per Unit () Special offer analysis Sales Vanable costs Contribution margin xed costs (incremental) income Total 187.500 112.500 75,000 $ 0 (b) The company should Accept special offer
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