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BACC011 Quiz 5- Requires Respondus LockDown Browser
Short answer
AquaCool produces and sells premium bottled water sourced from natural springs. Each bottle sells for $5. It costs $1.20 in variable costs and $1.80 in fixed costs to make each bottle. AquaCool has received a special order from a local community group. They would like to order 1,106 bottle for $2.32 each. AquaCool has the capacity to make this order. If AquaCool accepts this special order, how much will the profit increase or decrease by? Round your answer to the nearest dollar (no decimal places). If accepting the special order will decrease the profit, make sure you include a minus/negative sign before your answer.
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Step-by-Step Analysis
Starting with the problem: AquaCool would gain an incremental profit from the special order based only on variable costs and the selling price for this order, since fixed costs are already incurred and won't change with this one-time order.
Step 1: Determine the incremental......Login to view full explanationLog in for full answers
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