Narciso Corporation Is Preparing a Bid for a Special Order

Multiple Choice

Narciso Corporation is preparing a bid for a special order that would require 880 liters of material R19S.The company already has 280 liters of this raw material in stock that originally cost $6.10 per liter.Material R19S is used in the company's main product and is replenished on a periodic basis.The resale value of the existing stock of the material is $5.45 per liter.New stocks of the material can be readily purchased for $6.20 per liter.What is the relevant cost of the 880 liters of the raw material when deciding how much to bid on the special order?

A) $5,006
B) $5,456
C) $4,796
D) $5,456.