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evalue Company makes all types of office desks. The General Desk Division is entry producing 10,000 desks per year with a capacity of 15,000. The
evalue Company makes all types of office desks. The General Desk Division is entry producing 10,000 desks per year with a capacity of 15,000. The variable costs assigned to each desk are $300 and annual fixed costs of the division are $900,000. The General desk sells for $400, The Executive Division wants to buy 5,000 at $270 for its custom office design business. The General Desk manager refused the order because the price is below variable cost. The executive manager argues that the order should be accepted because it will lower the fixed cost per desk from $90 to $60 and will take the division to its capacity, thereby causing up to be at their most efficient level. From the perspective of the General Desk Division AND the company, should the order be accepted if the Executive Division plans on selling the desks in the outside market for $420 after incurring additional costs of $100 per desk! Simply answer "Yes" or "No" will not get any credit. You MUST show your work. Final
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