- The Crispy Baking Company is considering the expansion of its business into door-to-door delivery service. This

would require an additional $12,500 in labor costs per month. Company-owned vehicles now used to make morning

deliveries to restaurants could be used in the afternoons to make the home deliveries. However, it is estimated that

an additional $5,000 would be required per month for gas, oil, and maintenance. It is further estimated that the

home delivery use of the trucks would be allocated 45% of the existing $6,500 fixed vehicle costs. What is the

differential delivery cost per month for expanding into the home delivery market?

a) O $19,750

b) $12,500

c) none of the above

d) $17,500

e) $20,425