**Data Table****Total Costs for 80,000 Units**- **Direct Materials:** $240,000- **Direct Labor:** $36,000- **Variable Manufacturing Overhead:** $60,000- **Fixed Manufacturing Overhead:** $100,000**Total Manufacturing Costs:** $436,000**More Info**The company's relevant range extends to 93,000 units. Press has received a special order for 8,000 t-shirts at a special price of $44,000 for the entire order. The special order t-shirt would use a fabric that is less expensive than the standard fabric used by Press, allowing them to save $0.80 per t-shirt in direct materials. They have the excess capacity to manufacture this special order, and total fixed costs will not be impacted by it. **Press Products Special Order Analysis****Introduction:**Press Products manufactures t-shirts and evaluates the impact on operating income when considering accepting a special order. This analysis provides a breakdown of associated revenues and expenses to assess the decision.---### Cost and Impact Details:#### Instructions:- The production level currently stands at 80,000 units.- A detailed incremental analysis is required to determine the potential impact on operating income if the special order is accepted.- All monetary amounts should be rounded to the nearest cent or dollar as specified.---### Incremental Analysis of Special Sales Order Decision| **Item** | **Per Unit** | **Total Order (8,000 units)** ||----------|--------------|-------------------------------|| **Revenue from special order** | | || **Less variable expense associated with the order:** | | || - Direct materials | | || - Direct labor | | || - Variable manufacturing overhead | | || **Contribution margin** | | || **Less: Additional fixed expenses associated with the order** | | || **Increase (decrease) in operating income from the special order** | | |---**Note:**- Use “0” for any zero balances.- A negative impact on contribution margin or operating income should be represented with parentheses or a minus sign.This analysis will guide Press Products in making an informed decision regarding the acceptance of the special order based on financial metrics.

Name: **Data Table****Total Costs for 80,000 Units**- **Direct Materials:**
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Description: **Data Table****Total Costs for 80,000 Units**- **Direct Materials:** $240,000- **Direct Labor:** $36,000- **Variable Manufacturing Overhead:** $60,000- **Fixed Manufacturing Overhead:** $100,000**Total Manufacturing Costs:** $436,000**More Info**Th

Lets understand the basics. When special order situation arise then management calcualtes relevant…

Business

Accounting

Data table Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total manufacturing costs Print $ Total costs for 80,000 units Done 240,000 36,000 60,000 100,000 436,000 More info The company's relevant range extends to 93,000 units. Press has received a special order for 8,000 t-shirts at a special price of $44,000 for the entire order. The special order t-shirt would use a fabric that is less expensive than the standard fabric used y Press, which would allow Press to save $0.80 per t-shirt in direct materials when manufacturing this special order. Press has the excess capacity to manufacture this special order. Its total fixed costs will not be impacted by the special order. Print - Done X

Data table Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total manufacturing costs Print $ Total costs for 80,000 units Done 240,000 36,000 60,000 100,000 436,000 More info The company's relevant range extends to 93,000 units. Press has received a special order for 8,000 t-shirts at a special price of $44,000 for the entire order. The special order t-shirt would use a fabric that is less expensive than the standard fabric used y Press, which would allow Press to save $0.80 per t-shirt in direct materials when manufacturing this special order. Press has the excess capacity to manufacture this special order. Its total fixed costs will not be impacted by the special order. Print - Done X

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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