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Radar Company sells bikes for $530 each. The company currently sells 4,350 bikes per year and could make as many as 4,730 bikes per year.
Radar Company sells bikes for $530 each. The company currently sells 4,350 bikes per year and could make as many as 4,730 bikes per year. The bikes cost $275 each to make: $190 in variable costs per bike and $85 of fixed costs per bike. Radar received an offer from a potential customer who wants to buy 380 bikes for $500 each. Incremental fixed costs to make this order are $45,000. No other costs will change if this order is accepted. Compute Radars additional income (ignore taxes) if it accepts this order.
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