Lark Art Company Sells Unfinished Wooden Decorations at a Price

Essay

Lark Art Company sells unfinished wooden decorations at a price of $15. The current profit margin is $5 per decoration. The company is considering taking individual orders and customizing them for customers. To finish the decoration, the company would have to pay additional labor of $3 per unit, additional materials costing an average of $4 per unit, and fixed costs would increase by $1,500. If the company estimates that it can sell 600 units for $25 per unit each month, should it start taking the orders?