Question
Bluebird Mfg. has received a special one-time order for 15,000 bird feeders at $15 per unit. Bluebird currently produces and sells 75,000 units at $21.00
Bluebird Mfg. has received a special one-time order for 15,000 bird feeders at $15 per unit. Bluebird currently produces and sells 75,000 units at $21.00 each. These bird feeders would be marketed under the wholesaler's name and would not affect Bluebird's sales through its normal channels. Production costs for all units are $16.50 per unit, which includes $11.00 in variable costs and $5.00 of fixed costs. Assume that Bluebird has sufficient capacity to fill the order, should Bluebird accept the order? If no answer with a zero (use 0). If yes answer with the total amount of incremental profit.
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