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Costs for Thompson are as follows: Linearboard and corrugating medium: Cost $400x70%= $168 plus Out of Pocket: $400x30%=120 for a total cost of $288.Costs for West Papers would be a total of $430, and costs for Eire Papers would be $90x60%= $54 (Southern) plus $25 (Thompson), and their supplies of $432-5-36= $312 for a total of $391.
2. Should Mr. Kenton accept this bid? Why or why not?
Mr. Kenton should not accept the bid from West because it isn’t in the best interest of the company, but at the same time with the transfer policy that exists, it is really up to him what is in the best interests of his division...
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