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What is the incremental analysis

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Question - Incremental Analysis - If production does increase dramatically after their presentation on Shark Tank, the Lees will need more space for production. They have two options. Option 1 is to rent out a spacious warehouse nearby. If they pursue this option, their rent will be $2400 per month, and utilities are estimated to cost an additional $350 per month. Their second option, Option 2, is to rent a smaller storefront space that is also nearby. The storefront rent is $1950 per month. However, utilities will likely only cost an additional $250 per month. They want to compare their options over one year (since each rental contract is a 1-year commitment). What is the incremental analysis if the Lees choose Option 1 over Option 2?

Reference no: EM133026322

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