1.
PLEASE HELP ME GUYS THANK YOU SO MUCH!
Byways Production has an annual capacity of 80,100 units per year. Currently, the company is
making and selling 78,800 units a year. The normal sales price is $109 per unit; variable costs
are $65 per unit, and total fixed expenses are $2,000,000. An out-of-state distributor has offered
to buy 5,100 units at $70 per unit. Byways
Solution
Kindly post all the Questions in seperate Questions. I am answering Question no 1.
1)
Particulars Amount
Sales price 70.00
VC 65.00
Contribution per unit 5.00
No of units 5,100.00
Total contribtuion 25,500.00
Oppurtunity cost (3,800 * 44) 167,200.00
Loss from order (141,700.00)
Company has capacity of 80,100 units and it is selling
78,800 Unitrs
So company will increase production by 1,300 units
and will cut sales of 3,800 Units to existing customers
if it accepts the order