Radar Company sells bikes for $490 each. The company currently sells 4,800 bikes per year and...
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Radar Company sells bikes for $490 each. The company currently sells 4,800 bikes per year and could make as many as 5,000 bikes per year. The bikes cost $285 each to make: $190 in variable costs per bike and $95 of fixed costs per bike. Radar received an offer from a potential customer who wants to buy 875 bikes for $430 each. Incremental fixed costs to make this order are $48,000. No other costs will change if this order is accepted. Compute Radar's additional income (ignore taxes) if it accepts this order. Sales Variable cost Incremental Amount per Unit Incremental Fixed Costs Incremental Income from New Business $ 430 Contribution margin Fixed costs Incremental income (loss) from new business The company should Radar Company sells bikes for $490 each. The company currently sells 4,800 bikes per year and could make as many as 5,000 bikes per year. The bikes cost $285 each to make: $190 in variable costs per bike and $95 of fixed costs per bike. Radar received an offer from a potential customer who wants to buy 875 bikes for $430 each. Incremental fixed costs to make this order are $48,000. No other costs will change if this order is accepted. Compute Radar's additional income (ignore taxes) if it accepts this order. Sales Variable cost Incremental Amount per Unit Incremental Fixed Costs Incremental Income from New Business $ 430 Contribution margin Fixed costs Incremental income (loss) from new business The company should
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