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Sagot :
Blossom enterprise would realize $19920 incremental income by accepting the special Oder.
What is variable cost?
An expense for the company that varies according on how much is produced or sold is called a variable cost. Depending on a company's production or sales volume, variable costs grow or fall. They climb as production rises.
The number of bears that ordered by whole seller is 9,920 units.
Incremental revenue of the company is (9,920 × $16) = $168,720
Incremental cost is ($14 × 9,920) = $138,880
Additional shipping expenses ($1 × 9,920) = $9,920
The total cost to produced 9,920 bears is ($138,880 + $9,920) = $148,800
The incremental income that blossom enterprises would realize by accepting the special order is ($168,720 - $148,800) = $19920.
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