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What would be the incremental revenue

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Question - B&B produces and sells one single product: BT5. The production capacity of B&B is 65,000 units. Annual sales volume expected in 2021 is 50,000 units.

The following information is estimated for 2021: selling price per unit: $25, variable cost per unit: $16, and annual fixed costs: $324,000.

Using the original data provided, if B&B receives an offer from Big Z Ltd, which is not a current customer of B&B, to purchase additional 12,000 units at $18 per unit, and B&B would incur additional fixed costs of $20,000 but no other fixed costs to produce the 12,000 units required,

Required - What would be the incremental revenue if the offer is accepted?

Reference no: EM132838719

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