Answered step by step
Verified Expert Solution
Question
1 Approved Answer
choices given include a - the opportunity cost involved in accepting Allen's order b - the incremental cost of manufacturing an additional 5,000 saws per
choices given include
Burns Industries curtently manufactures and sells 20,000 power saws per month. although it has the capacity to produce 35 . oco units per month. At the 20.000-unt per-month level of production, the per-uni cost is $65, constigng of $40 in variable cosis and $25 in fixed costs. Burns sells its saws to retail stores for $80 each. Allen Distributorn hos offered to purchase 5,000 waws per month at a feduced price. Burns can manufarture these additonal units with no change in th present level of fixed manufacturing costs. Which of the following is not a fefevant fisctor in Burns' decision copceming whether to accept tie speciol order from Allen? Mulinge crobe Thut ocpontiny cent inwolved ir occepting Niens arder a - the opportunity cost involved in accepting Allen's order
b - the incremental cost of manufacturing an additional 5,000 saws per month
c - the $65 average cost per unit to manufacture a power saw
d - where and at what price Allen intends to sell the saws
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started