A B C D E F G H 1 Decision Making B (15 points) 2 Considering that all the variable from "Decision Making - Case 1", Cougar Inc. can make an additional 2,500 shirts by adding $10,000 in fixed costs 3 The following represents the sales and costs in a normal month, including the extra for making more t-shirts 4 Normal Capacity of the factory T-shirts per month 20,000 5 Additional Capacity 2,500 6 T-Shirts sold in a normal month 18,000 7 Selling Price of T-shirts $ 40 00 8 Cost to Cougar Inc of each shirt (material & labor) 5 25.00 9 Monthly fixed costs for employees to produce the shirts (COG) $ 25,000:00 10 Monthly fixed costs for rent, utilities, accountants, etc $ 45,000 00 11 Fixed Costs for making an additional 2,500 T-Shirts $ 10,000 00 12 13 Again, Longhorn Lid wants Cougar Inc. to sell them 5,000 T-shirts in December, but they only want to pay $30 per T-shirt 14 T-shirts sold to Longhorn Ltd in December 5,000 15 Longhom Lid offers to pay (per shirt) $ 30.00 16 QUESTION: Should Cougar Inc. sell Longhorn Lid. the T-shirts? How much would they gain or lose by taking this deal? Remember that if they sell the T-shirts to Longhorn Lid. for $30, they cannot sell 17 them to UH fans for $40 18 19 Create an income statement for Cougar Inc. doing business as normal. THEN create one for if they accept Longhom Lid's proposal 20 THEN calculate how much Cougar Inc. would make or lose by accepting the offer BE SURE YOU DO ALL 3 PARTS and Show your Work 21 Partial credit will be awarded if I can figure out you are on the right track 22 23