Forrmula Pract Test 4A Secure httpsmoodlecobleskilledumodqui

Forrmula Pract Test 4A Secure https//moodle.cobleskill.edu/mod/quiz/attempt.php?attempt-180313&cmid-159675; Current Students C ? my BusinessCoursel ? Text book D BannerWeb Cob lesk Ermal Cobleskill * NET Bank AOL N Cobleskill SUNY Cobleskill Moodle My Courses Library CobyNet Academics ome> ?? courses > ACCT-103-30889-201806 > Topic 4 Decision-Making Tools > Test 4A Question 1 Not yet answered Points out of 1.00 P Flag question A product has a $100 per unit selling price, $40 variable cost per unit and $100.000 of fixed costs. It currently sells 40.000 units and has capacity to produce another 100.000 units. A special order comes in for 5.000 units at a sales price of $80 each. The job will require $10 of overtime costs per unit and 2.000 of additional transportation costs Assuming we accept the special order, how much will this increase our profit or sloss>? Select one: O A. $13,000 B. D. $8,000 Type here to search

Solution

CALCULATION OF THE INCREAMENTAL PROFIT ON SPECIAL ORDER Units Rate Amount Increase Revenue 5000 $            80 $       4,00,000 Less: Expenses Variable Cost 5000 $            40 $       2,00,000 Overtime Cost 5000 $            10 $           50,000 Addittional Transportation cost $             2,000 Net Revenue from the accept of special order $       1,48,000 Note: There is problem in Answer given, If we take the selling price and variable cost from the question than above answer will came Now, if we change the figure of Selling price from $ 80 to $ 8 and So Variable cost and others t than only correct answer will came as question. CALCULATION OF THE INCREAMENTAL PROFIT ON SPECIAL ORDER Units Rate Amount Increase Revenue 5000 $              8 $           40,000 Less: Expenses Variable Cost 5000 $              4 $           20,000 Overtime Cost 5000 $              1 $             5,000 Addittional Transportation cost $             2,000 Net Revenue from the accept of special order $           13,000 Answer = Option A = $ 13,000