Coroid Manufacturers Inc. is approached by a European customer to fulfill a one-time-only special order for a product similar to one offered to domestic customers. The company has excess capacity. The following per unit data apply for sales to regular customers: Variable costs: Direct materials $120 Direct labor 60 Manufacturing support 105 Marketing costs 45 Fixed costs: Manufacturing support 135 Marketing costs 45 Total costs 510 Markup (50%) 255 Targeted selling price $765 What is the change in operating profits if the one-time-only special order for 1,000 units is accepted for $540 a unit by Coroid? Select one: a. $225,000 decrease in operating profits b. $30,000 decrease in operating profits c. $210,000 increase in operating profits d. $30,000 increase in operating profits
Coroid Manufacturers Inc. is approached by a European customer to fulfill a one-time-only special order for a product similar to one offered to domestic customers. The company has excess capacity. The following per unit data apply for sales to regular customers:
Variable costs:
Direct materials $120
Direct labor 60
Manufacturing support 105
Marketing costs 45
Fixed costs:
Manufacturing support 135
Marketing costs 45
Total costs 510
Markup (50%) 255
Targeted selling price $765
What is the change in operating profits if the one-time-only special order for 1,000 units is accepted for $540 a unit by Coroid?
Select one:
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