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3 years ago

The costs and revenues associated with two alternatives are listed below:

Business

1 answer:

Fudgin [204]3 years ago

6 0

Answer:

The correct option is A,alternative 2 because it has a higher profit

Explanation:

The profit analysis of both alternatives is done below:

Alternative 1 Alternative 2

Projected revenue $100,000 $125,000

Costs:

unit level costs $20,000 $30,000

Batch-level costs $20,000 $25,000

Product-level costs $15,000 $15,000

facility-level costs $10,000 $10,000

total costs $65,000 $80,000

Profit(revenue-total costs) $35,000 $45,000

The correct answer is option A,as option 2 has a higher profit of $45,000 compared to alternative 1 of $35,000

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