Baseball Mitts Pty Ltd has been asked to fulfil a special order for 2000 mitts at a 20% discount on the current selling price.Baseball Mitts Pty Ltd are already at full production capacity and would have to forgo regular sales worth $50 000 if they accept this special order.If the net benefits of the special order total $20 000 should they accept the order?
A) Yes, the profits will increase by $20 000.
B) No, a loss of $30 000 will be generated from the special order.
C) Yes, as long as there are no adverse long-term effects that outweigh the short-term benefits.
D) No. Baseball Mitts Pty Ltd do not have the capacity to accept this special order.
Correct Answer:
Verified
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