Costing orders, profitability and opportunity cost:

Fixus Ltd. manufactures chips used in personal computers. Its practical capacity is 4,000 chips per week. Fixed costs are $120,000 per week. The selling price is $ 280 per chip. The average production last month is 3,600 per week. At this level of production, variable costs are $ 810,000 per week.

a) What is the (average) profir per week for last month ? b) What will the profit be per week if it operates at practical capacity ? c) Suppose that a new customer offers $ 225 per chip for an order of 400 chips per week for delivery beginning this month . What is the estimated change in the company's profit if it accepts the order ? d) Suppose that the new customer offers $ 255 per chip for an order of 1,000 chips per week and that Fixus Ltd. cannot schedule overtime production. What is the total amount of opportunity costs that has to be considered when deciding what to do and what is the estimated change in Fixus's profit if it accepts this order for 1,000 chips per week ?