Lark Company Manufactures Dog Food for Distribution in Washington, Oregon

question 117

Multiple Choice

Lark Company manufactures dog food for distribution in Washington, Oregon, and California.A dog food distributor from Florida has approached Lark and offered to purchase 240,000 pounds of dog food for $1.40 per pound.Lark can produce 2,000,000 pounds of dog food per year, and its results for last year are as follows: If Lark accepts the offer, it will only be able to sell 1,760,000 pounds of dog food at the regular price due to its capacity constraints.What will Lark's total operating income be next year if it accepts the offer?

• A)$1,358,000
• B)$1,250,000
• C)$1,310,000
• D)$2,040,000

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