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Intercontinental s special order requires 1 , 8 0 0 kilograms of genatope, a solid chemical regularly used in the company s products. The current

Intercontinentals special order requires 1,800 kilograms of genatope, a solid chemical regularly used in the companys products. The current stock of genatope is 8,800 kilograms at a book value of 8.70 p per kilogram. If the special order is accepted, the firm will be forced to restock genatope earlier than expected, at a predicted cost of 9.30 p per kilogram. Without the special order, the purchasing manager predicts that the price will be 8.90 p when normal restocking takes place. Any order of genatope must be in the amount of 5,700 kilograms.
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1. What is the relevant cost of genatope?

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