12. Bania's Soup Company is considering accepting a special order for its soup. The normal sales price ofa case of soup is $22 and the variable cost per case of soup is $17. Bania's total fixed costs are $10,000,which is equivalent to $5 per case. Normal volume is 2,000 cases of soup. The relevant range is 1,000 –4,000 cases. The company has received a special order for 200 cases of soup at a price of $19 per case.If they accept the order:A. Their profits will increase by $3,800B. Their profits will decrease by $600C. Their profits will decrease by $1,400D. Their profits will increase by $400312

correct option is D i.e. their profits will increase by $400

Answered: 12. Bania's Soup Company is considering…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Teddy Dog Food Incorporated (TDFI) currently makes and sells one type and size of dog food, a 16 ounce bag of all-natural freeze-dried chicken. TDFI sells each bag of food for $10. The Variable Expense per bag of food is $6. Fixed Expenses per month total $300. If TDFI sells three extra bags of dog food, by how much does TDFI's overall profit increase? Omit the dollar sign in your answer.
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Sagar
Mobile Homes has an annual demand of 10,000 units for a small refrigerator. The supplier sells the units for $100 in order quantities below 124 and for $95 in order quantities above 125 units. The order cost is $5, and the annual holding cost is 10% of unit value. a) In what quantities should the item be purchased with an all-units quantity discount? b) If an incremental quantity discount schedule is in effect, how many refrigerators should Gursoy order each time an order is placed? c) Compare the cost savings for parts a) and b) with respect to the original case without discount. Which schedule is better?
Broomfield Corp. has 1,000 carton of oranges that cost $50 per carton in direct costs and $26.50 per carton in indirect costs and sold for $70 per carton. The oranges can be processed further into orange juice at an additional cost of $22.50 and sold at a price of $126. The incremental income (loss) from processing the oranges into orange juice would be: Multiple Choice ($100,500). $103,500. $92,500. $100,500. $93,500.

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