Management believes 6,000 WVD drums could be sold each year if the company had s

Question

Management believes 6,000 WVD drums could be sold each year if the company had suffi -
cient manufacturing capacity. As an alternative to adding another welding machine, management
has considered buying additional drums from an outside supplier. Harcor Industries, Inc., a supplier
of quality products, would be able to provide up to 4,000 WVD-type drums per year at a price
of $138 per drum, which TufStuff would resell to its customers at its normal selling price after appropriate
relabeling.
Megan Flores, TufStuff

Explanation / Answer

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