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What is total opportunity cost with taking special order

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Reference no: EM132516673

Kragle Ltd manufacturers adhesives including the advanced X1000. The following information relates to the production of X1000.

Production capacity                    100,000 units per month
Current production level                  84,000 units per month
Selling price          $                        9 per unit
Variable cost ($)                              3 per unit
Fixed cost per unit($)                       1  per unit

  • Kragle Ltd receives a special order from MicroTech for 24,000 units of X1000 at a special order price of $8.

Question 1: What is the total opportunity cost associated with taking this special order? And what is the profit or loss Kragle will make if they take this special order?

Reference no: EM132516673

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