Answer:
The correct answer is option (B) $90,000
Explanation:
Given Data;
Alternative A Projected revenue= $ 210,000
Alternative B Projected revenue = $ 300,000
A -Unit-level costs = $40,000
B- Unit-level costs = $51,000
A -Batch-level costs $27,500
B- Batch-level costs = $39,000
A -Product-level costs = $30,000
B-Product-level costs = $32,000
A-Facility-level costs = $25,000
B-Facility-level costs = $27,500
To calculate the differential revenue, we use the formula;
Differential revenue = Revenue for alternative A - Revenue for alternative B
Substituting, we have
Differential revenue = $300,000 - $210,000
= $90,000
