ACT 305 Module 4 Critical Thinking Assignment Cost of Operation Exercise
Assignment Choice #1: Cost of Operation Exercise
Toy Box, Inc., is contemplating expanding sales of their children’s toys. The have an opportunity to stock and sell the X toy that has been a big hit with children everywhere. They must order the X toys from the manufacturer in a minimum order of 100 at a cost of $12 each. They could resell the X toy in their store for $22 each.
Due to anticipated demand, Toy Box, Inc., will need to hire an additional part-time cashier at $600 a month, which will be classified as a fixed-cost attributable to the X toy. In addition, they have offered a
$1 sales commission per toy to their floor sales representative. Finally, they will include a package of
trading cards with every purchase of an X toy, which will cost them an additional $2 each. Instructions:
In a well-written paper, answer the questions and perform the calculations described below:
Your paper must be written in Word and should meet the following requirements:
Be sure to review the Module 4 Critical Thinking grading rubric, which may be accessed through the Course Information page.