Amazon.com, Inc. considers expanding its warehouse facilities. In May 2038, the company estimates the following costs:

• Current Operating Costs: $10,000,000
• Expansion Costs: $15,000,000
• Additional Revenue from Expansion: $20,000,000

Requirements:

• Perform relevant cost analysis for the expansion decision.
• Calculate the net benefit of the expansion.
• Identify any sunk costs and explain their irrelevance.
• Prepare a recommendation report for the expansion.
• Discuss the long-term strategic benefits of the expansion.