BioHemi, Inc. Response In the case of BioHemi’s old product, the decision on what to do is a difficult one. When meeting with the team I would consider the potential loss or gain when it comes to selling this product. If we decided to not continue the sale of the old product, then the company would face an automatic loss of 37.5 million dollars due to wasted inventory. We would also be facing a loss regarding the fixed price contracts because the company would not be generating enough profit to cover them. On the other hand if we did continue to sell the old product we would not face the 37.5 million dollar loss, and know that we would generate enough income to cover our expenses. Going into the team meeting I would discuss both options to the other members. As the accountant for the company product team I would recommend that we continue to sell the old product, only selling up to the 500,000 units in our inventory. Once we sold those units, we would no longer have the loss or the contracts to worry about. As of now though, we simply couldn’t rely on the new product generating enough revenue to cover all of our costs. There are many reasons why I would suggest this. Recovering from a 37.5 million dollar loss would be really difficult for the company. If that was to happen, we would want to cut expenses as much as possible to somehow make up for that amount. Many of the employees would have to be laid off, or fired, in result to this action. Firing those employees would not only affect themselves, but their families as well. This would also make the company inefficient, because there was probably a reason why they were employed in the first place. Research and development for the new product is also something that would cause me to recommend the sale of the old product. The new product is what the company needs to focus on, but it takes funds to do