Almond Treats manufactures various types of cereals that feature almonds. Acme Cereal Company has approached Almond Treats with a proposal to sell the company its top selling cereal at a price of $22,000 for 20,000 pounds. The costs shown are associated with production of 20,000 pounds of almond cereal:

The manufacturing overhead consists of $2,000 of variable costs with the balance being allocated to fixed costs. What are the total relevant costs? If Almond Treats buys the cereal,what is the effect on profit? Should Almont Treats make or buy the almond cereal?

Almond Treats cost data