financial account Allison's Auto Art is a company that applies pinstripes to vehicles.Allison's cost for a basic 1 - color pinstriping job is $35, and shecharges $95 for this service. For a total price of $175, Allison will applya fancier 3 - color pinstripe application to an automobile, a service thatadds an additional $40 to the total cost of the package. Should Allisoncontinue to offer the 3 - color pinstripe application?A Yes, but only if she lowers the price of the 1 - color applicationB No, her marginal benefit is less than her marginal costC Yes, she still makes a profit by selling the 3 - color application.D More information is needed for Allison to make this decision.

1-color3-colorTotal price$95$175Less: Cost(35)(75) [$35,000 + $40,000]Profit$60$100Profit margin…

Answered: Allison's Auto Art is a company that…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Diamond Boot Factory normally sells its specialty boots for $24 a pair. An offer to buy 125 boots for $16 per pair was made by an organization hosting a national event in Norfolk. The variable cost per boot is $9, and special stitching will add another $3 per pair to the cost. Determine the differential income or loss per pair of boots from selling to the organization.$fill in the blank 1 Income/Loss? Should Diamond Boot Factory accept or reject the special offer? Yes or No
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