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A business received an offer from an exporter for 10,000 units of product at $17.50 per unit. The acceptance of the offer will not affect
A business received an offer from an exporter for 10,000 units of product at $17.50 per unit. The acceptance of the offer will not affect normal production or domestic sales prices. The following data is available:
| Domestic unit sales price | $20 |
| Unit manufacturing costs: | |
| Variable | 14 |
| Fixed | 1 |
What is the differential cost from the acceptance of the offer?
| $200,000 | ||
| $175,000 | ||
| $140,000 | ||
| $110,000 |
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