(Solved):Consider the following information, prepared based on a monthly capacity of 50,000 units:…

 

Question

Consider the following information, prepared based on a monthly capacity of 50,000 units :

Category Cost per Unit Variable manufacturing costs $28
Fixed manufacturing costs $6
Variable selling costs $7
Fixed selling costs $9

Capacity cannot be added in the short run and the firm currently sells the product for $58 per unit.

The company is currently producing 50,000 units per month.

A potential customer

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