2022, the company reported the following operating results while operating at 75% of plant capacity: Sales (347,200 units) $4,380,000 Cost of goods sold 2,589,120 Gross profit 1,790,880 Operating expenses 837,620 Net income $953,260 Cost of goods sold was 70% variable and 30% fixed; operating expenses were 80% variable and 20% fixed. In September, Wildhorse receives a special order for 20,200 toasters at $8.09 each from Luna Company of Ciudad Juarez. Acceptance of the order would result in an additional $3,000 of shipping costs but no increase in fixed costs. (a) Prepare an incremental analysis for the special order. (Round computations for per unit cost to 2 decimal places, e.g. 15.25 and all other computations and final answers to the nearest whole dollar, e.g. 5,725. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Revenues Cost of goods sold Operating expenses Reject Order 0 0 SA Accept Order 170040 $ 107256 0 42558 Net Income Increase (Decrease) 170040 107256 42558 Net income $ 0 20226 $ 20226 (b) Should Wildhorse accept the special order? Wildhorse Company the special order. SUPPORT
2022, the company reported the following operating results while operating at 75% of plant capacity: Sales (347,200 units) $4,380,000 Cost of goods sold 2,589,120 Gross profit 1,790,880 Operating expenses 837,620 Net income $953,260 Cost of goods sold was 70% variable and 30% fixed; operating expenses were 80% variable and 20% fixed. In September, Wildhorse receives a special order for 20,200 toasters at $8.09 each from Luna Company of Ciudad Juarez. Acceptance of the order would result in an additional $3,000 of shipping costs but no increase in fixed costs. (a) Prepare an incremental analysis for the special order. (Round computations for per unit cost to 2 decimal places, e.g. 15.25 and all other computations and final answers to the nearest whole dollar, e.g. 5,725. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Revenues Cost of goods sold Operating expenses Reject Order 0 0 SA Accept Order 170040 $ 107256 0 42558 Net Income Increase (Decrease) 170040 107256 42558 Net income $ 0 20226 $ 20226 (b) Should Wildhorse accept the special order? Wildhorse Company the special order. SUPPORT
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Learn and Apply - Chapter 20 and 21
Question 3 of 10
0.31/1
2022, the company reported the following operating results while
operating at 75% of plant capacity:
Sales (347,200 units)
$4,380,000
Cost of goods sold
2,589,120
Gross profit
1,790,880
Operating expenses
837,620
Net income
$953,260
Cost of goods sold was 70% variable and 30% fixed; operating
expenses were 80% variable and 20% fixed.
In September, Wildhorse receives a special order for 20,200 toasters
at $8.09 each from Luna Company of Ciudad Juarez. Acceptance of the
order would result in an additional $3,000 of shipping costs but no
increase in fixed costs.
(a)
Prepare an incremental analysis for the special order. (Round
computations for per unit cost to 2 decimal places, e.g. 15.25
and all other computations and final answers to the nearest
whole dollar, e.g. 5,725. Enter negative amounts using either a
negative sign preceding the number e.g. -45 or parentheses e.g.
(45).)
Revenues
Cost of goods
sold
Operating
expenses
Net income
(b)
Reject
Order
$
Accept
Order
170040
$
107256
42558
$
20226
Should Wildhorse accept the special order?
Wildhorse Company
the special order.
Net Income
Increase
(Decrease)
170040
107256
42558
SA
$
20226
SUPPORT
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