M http://ezto.mheducation.com/hm.tpx || M Chapters 24-25 Homework ×19 Chegg Stud
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M http://ezto.mheducation.com/hm.tpx || M Chapters 24-25 Homework ×19 Chegg Study | Guided Solution File Edit View Favorites Tools Help E' Younique by Courtney s.. Gastric Sleeve weight Los west Kentucky Communi welcome to Facebook - G Google e Home Chegg KQuestion 19 (of 23) Save & ExiSubmit 19 4.00 polnts Radar Company sells bikes for $500 each. The company currently sells 4,850 bikes per year and could make as many as 7,000 bikes per year. The bikes cost $285 each to make, $165 in variable costs per bike and $120 of fixed costs per bike. Radar received an offer from a potential customer who wants to buy 750 bikes for $414 each. Incremental fixed costs to make this order are $36,000. No other costs will change if this order is accepted. Compute Radar's additional income (ignore taxes) if it accepts this order. Incremental IncrementalIncremental Amount per Fixed Costs Income from New Business Unit Contribution margin Incremental income (loss) from new business The company should 11:37 PM 4/19/2016Explanation / Answer
units 750 bikes
Actual price($) Incremental amount($)
Sales 213750 (750*285) 310500 (750*414)
variable cost (123750) (750*165) 123750(750*165)
Contribution 90000 186750
Fixed costs (36000) (36000)
Operating income 54000 150750.
incremental income is 96750 [ 150750 - 54000].
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