A local skating rink charges each person $5 to skat, Supply Chain Management

A local skating rink charges each person $5 to skat, Supply Chain Management

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A local skating rink charges each person $5 to skate and another $3 for each skate rental. The rink has determined that on a daily basis, when 100 tickets are sold, the costs per skater are $.50 for variable costs and $1 for fixed costs. The rink has the capacity for up to 175 skaters per day.

A local kid?s day camp has asked the rink to allow 35 children to skate for only $2.50 each on July 15, 2007. This price would include the cost of a skate rental as well as admission. During July, the rink averages 100 skaters a day, so they do have the capacity to accept this order if they wish. 1. lIST 2 QUALITATIVE FACTORS THAT SHOULD BE CONSIDERED BY THE RINK BEFORE ACCEPTING THE SPECIAL ORDER. 2. WHAT ARE THE TOTAL RELEVANT COSTS OF ACCEPTING THE SPECIAL ORDER? 3. FROM A QUANTITATIVE BASIS, SHOULD THEY ACCEPT THE SPECIAL ORDER? BY WHAT AMOUNT WILL THE RINK''''''S NET INCOME INCREASE OR DEREASE IF THEY ACCEPT THE SPECIAL ORDER?

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