Alpha inc produces a product that currently sells for $110 per unit. Current production costs per unit include direct materials of $30, direct labor of $25, variable overhead of $15. fixed overhead of $20, and total production costs of $90. Alpha Inc. has received a special pricing offer from a nonprofit organization to buy 5,000 units at $60 per unit. Alpha Inc currently has ide production capacity Based on the scenario, Alpha inc should O accept the special offer because the contribution margin from the offer is $80 O not accept the special offer because the contribution margin fhiom the offer ($110) O accept the special offer because the contribution margin from the offer is Sto O not accept the special offer because the conti bution margin from the offer ($10
Alpha inc produces a product that currently sells for $110 per unit. Current production costs per unit include direct materials of $30, direct labor of $25, variable
O accept the special offer because the contribution margin from the offer is $80
O not accept the special offer because the contribution margin fhiom the offer ($110)
O accept the special offer because the contribution margin from the offer is Sto
O not accept the special offer because the conti bution margin from the offer ($10
AI-generated content may present inaccurate or offensive content that does not represent bartleby’s views.
Unlock instant AI solutions
Tap the button
to generate a solution
