PLEASE HELP! WILL GIVE THUMBS UP!

A company is considering the following alternatives:

	Alternative 1	Alternative 2
Revenues	$120,000	$120,000
Variable costs	60,000	70,000
Fixed costs	35,000	35,000

Which of the following are relevant in choosing between the alternatives?

Variable costs and fixed costs

Revenues

Fixed costs

Variable costs

It costs Crane Company $12 of variable and $5 of fixed costs to produce one bathroom scale which normally sells for $35. A foreign wholesaler offers to purchase 3700 scales at $15 each. Crane Company would incur special shipping costs of $1 per scale if the order were accepted. Crane has sufficient unused capacity to produce the 3700 scales. If the special order is accepted, what will be the effect on net income?

$7400 decrease

$11100 decrease

$55500 increase

$7400 increase