Gregg Mfg produces miniature birdcages for the Southern California region. Each birdcage consists of $1.20...
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Gregg Mfg produces miniature birdcages for the Southern California region. Each birdcage consists of $1.20 of variable costs and $.90 of fixed costs and sells for $4.50 a piece. A French wholesaler offers to buy 8,000 units at $1.40 each. Gregg's current output of 15,000 cages is at 75% of capacity. Gregg will incur extra shipping costs of $0.12 per birdcage. Instructions 1. What is the incremental income or loss that Gregg Enterprises would realize by accepting the special order? Show computations. 2. Based only on all the data provided should Gregg Mfg. accept or reject the special offer? Why or why not? Justify your answer thoroughly
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