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Ch 11 Assignment

which does not cover the amount

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Unformatted text preview: 32 320,000 $3,000,000 $259 $300 $2,590,00 Svenson should just continue to produce the CMBCs internally because it is less ($259 per unit) to produce within the company as opposed to producing at Minton ($300 per unit). 3. Svenson should continue to make the CMBCs because the opportunity cost of making the products within their factory is zero. This does not lose profit or lose Svenson money. 11 21) 1. 264,000 units x $7 = $1,848,000 in revenue – 22,000x260 = $5,720,000. The opportunity cost is $5,720,000  ­ $1,848,000 = $3,872,000 2. Yes, the opportunity should be recorded. 3. They should purchase because they won’t know how their sales will vary each month. It also has a bigger opportunity cost and costs $3,872,000 more....
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