What other relevant factors might Linda consider before she makes a decision about the King Krab order? List as many factors as you can.

Accounting by Geoffrey

Cumulative Exercise (Chapter 4): Market–based price (elasticity formula), special order decision Oysters
Away shucks and packs oysters and sells them wholesale to fine restaurants across the state. The income statement
for last year follows:

Pickers, shuckers, and packers are employed on an hourly basis and can be laid off whenever necessary. Salespeople merely

deliver the product, and so are paid on a salaried basis.
Linda Hanson, manager of Oysters Away, believes that a price increase of 10% would result in a 15% decrease in sales.
The King Krab Restaurant is providing dinner for a meeting of the Pickers, Shuckers, and Packers Union in Seattle. King
Krab offered to pay Oysters Away $65 a case for 300 cases of oysters. This sale would not affect Oysters Away’s regular
sales.
REQUIRED
:
• A. Ignoring the King Krab offer, estimate the profit–maximizing price for Oysters Away.
• B. Assuming Linda is not willing to lose money on the King Krab order, what is the minimum price that she
should accept for the special order?
• C. What other relevant factors might Linda consider before she makes a decision about the King Krab order? List as many factors as you can.