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Title: George P. Burdell owns a hot tub store that is experiencing significant growth. Burdell is trying to ... Post by: lexisastudent on Jan 30, 2018 George P. Burdell owns a hot tub store that is experiencing significant growth. Burdell is trying to decide whether to expand the store's capacity, which currently is at 750,000 in sales per quarter.
He is thinking about expanding to the 850,000 level. The before-tax profit from additional sales is 20 percent. Sales are seasonal, with peaks in the spring and summer quarters. Forecasts of capacity requirements, expressed in (000 ) sales per quarter, for next year (year 2 ) are: Quarter (000 ) 1 720 2 800 3 890 4 690 Demand in year 3 and beyond is expected to exceed 850,000 per quarter. Burdell is considering expansion at the end of the fourth quarter of this year (year 1). How much would before-tax profits in year 2 increase because of this expansion? A) less than 28,000 B) more than 28,000 but less than 32,000 C) more than 32,000 but less than 36,000 D) more than 36,000 Title: George P. Burdell owns a hot tub store that is experiencing significant growth. Burdell is trying to ... Post by: schoolboy4367 on Jan 30, 2018 Content hidden
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