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What is the differential profit per unit for the best solution for Alpha? Alpha has 300 units of an obsolete part with a regular selling
What is the differential profit per unit for the best solution for Alpha?
Alpha has 300 units of an obsolete part with a regular selling price of 20. The UVC to produce them was 5. The company has several options.
One option is that a company has offered to buy the part at 4 each.
A second option is that Alpha could do additional work on the part for 8 per unit and then sell them for 11 per unit.
A third option is to write the part off taking the
loss.
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