15-515-15 No, the $60 per unit manufacturing cost which was incurred to producethe 40,000 barbeque grills is not relevant. This is a past cost. Ithas already been incurred and its total amount cannot be affected by adecision regarding to whom to sell the grills. The only costs andrevenues which would be relevant are the future costs and revenueswhich differ between the alternatives. The following would berelevant:(1) Sales revenue(2) Sales promotion or advertising costs(3) Shipping costs(4) Storage and handling costs(5) Property taxes and insurance on the grills in inventory(6) Clerical costs associated with prolonged domestic sales15-16 Alternative 1: to store the rafts and sell them next yearSales 10,500* rafts @ $9 $94,500Storage costs (8,500)Profit to be earned $86,000*[15,000 - (0.30 x 15,000)] = 10,500 rafts
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