Chrome - Study Plan Practice - Laura Medina mathxl.com/Student/PlayerPractice.aspx?chapterld=25&sld=2&single=true¢erwin=yes BUSAD202-8691-S2020 Laura Medina | 04/19/20 1:26 PM 25.2 Make regular and special pricing decisions Close 1 of 13 (1 complete) O correct X TI25-2 (similar to) Question Help Lewis Company makes a product that regularly sells for $14.00 per unit. i (Click the icon to view additional information.) 7. If Lewis Company has excess capacity, should it accept the offer from Wismer? Show your calculations. 8. Does your answer change if Lewis Company is operating at capacity? Why or why not? 7. If Lewis Company has excess capacity, should it accept the offer from Wismer? Show your calculations. (Use a minus sign or parentheses to show a decrease in operating income.) Expected increase in revenue More Info Expected increase in variable manufacturing costs Expected increase/(decrease) in operating income The product has variable manufacturing costs of $9.00 per unit and fixed manufacturing costs of $1.80 per unit (based on $306,000 total fixed costs at current production of 170,000 units). Therefore, total production cost is $10.80 per unit. Lewis Company receives an offer from Wismer Company to purchase 5,400 units for $8.50 each. Selling and administrative costs and future sales will not be affected by the sale, and Lewis does not expect any additional fixed costs. Print Done Enter any number in the edit fields and then click Check Answer. 3 parts remaining Clear All Check Answer 1:26 Chrome - Study Plan Practice - Laura Medina mathxl.com/Student/PlayerPractice.aspx?chapterld=25&sld=2&single=true¢erwin=yes BUSAD202-8691-S2020 Laura Medina | 04/19/20 1:26 PM 25.2 Make regular and special pricing decisions Close 1 of 13 (1 complete) O correct X TI25-2 (similar to) Question Help Lewis Company makes a product that regularly sells for $14.00 per unit. i (Click the icon to view additional information.) 7. If Lewis Company has excess capacity, should it accept the offer from Wismer? Show your calculations. 8. Does your answer change if Lewis Company is operating at capacity? Why or why not? 7. If Lewis Company has excess capacity, should it accept the offer from Wismer? Show your calculations. (Use a minus sign or parentheses to show a decrease in operating income.) Expected increase in revenue More Info Expected increase in variable manufacturing costs Expected increase/(decrease) in operating income The product has variable manufacturing costs of $9.00 per unit and fixed manufacturing costs of $1.80 per unit (based on $306,000 total fixed costs at current production of 170,000 units). Therefore, total production cost is $10.80 per unit. Lewis Company receives an offer from Wismer Company to purchase 5,400 units for $8.50 each. Selling and administrative costs and future sales will not be affected by the sale, and Lewis does not expect any additional fixed costs. Print Done Enter any number in the edit fields and then click Check Answer. 3 parts remaining Clear All Check Answer 1:26