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QS 23-20 (Algo) Special offer pricing LO P7 Radar Company sells bikes for $470 each. The company currently sells 4,200 bikes per year and could
QS 23-20 (Algo) Special offer pricing LO P7 Radar Company sells bikes for $470 each. The company currently sells 4,200 bikes per year and could make as many as 4,580 bikes per year. The bikes cost $285 each to make: $185 in variable costs per bike and $100 of fixed costs per bike. Radar receives an offer from a potential customer who wants to buy 380 bikes for $450 each. Incremental fixed costs to make this order are $90 per bike. No other costs will change if this order is accepted. (a) Compute the income for the special offer. (b) Should Radar accept this offer
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