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The production cost information for Sheridan's Salsa is as follows: Sheridan's Salsa Production Costs April 2020 28,000 Production Jars of Salsa Ingredient cost (variable) $22,400
The production cost information for Sheridan's Salsa is as follows: Sheridan's Salsa Production Costs April 2020 28,000 Production Jars of Salsa Ingredient cost (variable) $22,400 Labor cost (variable) 11,200 Rent (fixed) 5,100 Depreciation (fixed) 7,600 Other (fixed) 1,600 Total $47,900 The company is currently producing and selling 364,000 jars of salsa annually. The jars sell for $8.00 each. The company is considering lowering the price to $7:50. Suppose this action will increase sales to 420,000 jars. (a) What is the incremental cost associated with producing an extra 56,000 jars of salsa? Incremental Cost $
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