Bluebird Mfg

question 118

Multiple Choice

Bluebird Mfg.has received a special one-time order for 15,000 bird feeders at $3 per unit.Bluebird currently produces and sells 75,000 units at $7.00 each.This level represents 80% of its capacity.These bird feeders would be marketed under the wholesaler's name and would not affect Bluebird's sales through its normal channels.Production costs for these units are $3.50 per unit,which includes $2.25 variable cost and $1.25 fixed cost.If Bluebird accepts this additional business,the incremental cost will be:

• A)$45,000.
• B)$11,250.
• C)$38,750.
• D)$7,500.
• E)$33,750.

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Definitions:

Intensity

The degree of strength, power, or force of something, often related to sensations, feelings, or signals.

Blind Spot

An area in the visual field that lacks detection of light due to the absence of receptor cells on the optic disc of the retina.

Fovea

A small depression in the retina of the eye where visual acuity is highest, due to the concentration of cones.

Retina

The light-sensitive layer of tissue at the back of the inner eye, which transmits visual information to the brain via the optic nerve.