Crib World Is Considering a Merger with Tots Supply Stores

question 52

Multiple Choice

Crib World is considering a merger with Tots Supply Stores. Crib's total operating costs of producing services are $250,000 for sales volume of $1.25 million. Tots' total operating costs of producing services are $210,000 for a sales volume (JP) of $900,000. Calculate the average cost of production for the Crib and Tots firms, respectively.

• A) 20 percent, 23.33 percent
• B) 23.33 percent, 20 percent
• C) 27.78 percent, 16.8 percent
• D) 21.4 percent, 21.4 percent