Fixed costs Fixed overhead Fixed general and administrative Income A potential customer offers to buy 50,000 units for $3.20 each. These sales would not affect the company's sales through its normal channels. Details about the special offer follow. . 0.20 0.15 $ 3.25 •. Direct materials cost per unit and variable overhead cost per unit would not change. • Direct labor cost per unit would be $0.54 because the offer would require overtime pay. • Accepting the offer would require incremental fixed general and administrative costs of $5,000. Accepting the offer would require no incremental fixed overhead costs. Required: 1. Compute income from the special offer. 2. Should the company accept or reject the special offer? Required 1 Complete this question by entering your answers in the tabs below. Required 2 80,000 60,000 $ 1,300,000 Should the company accept or reject the special offer? Should the company accept or reject the special offer? < Required 1 Required 2 > Prev 1 of 1 w www Next

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Fixed costs
Fixed overhead
Fixed general and administrative
Income
A potential customer offers to buy 50,000 units for $3.20 each. These sales would not affect the company's sales through its normal
channels. Details about the special offer follow.
• Direct materials cost per unit and variable overhead cost per unit would not change.
Direct labor cost per unit would be $0.54 because the offer would require overtime pay.
Accepting the offer would require incremental fixed general and administrative costs of $5,000.
Accepting the offer would require no incremental fixed overhead costs.
Required:
1. Compute income from the special offer.
2. Should the company accept or reject the special offer?
Required 1
Complete this question by entering your answers in the tabs below.
2
Should the company accept or reject the special offer?
Should the company accept or reject the special offer?
20
Required 2
F2
0.20
0.15
$ 3.25
#3
80
F3
< Required 1
$
4
F4
80,000
60,000
$ 1,300,000
15
%
F5
Required 2 >
Prev
1 of 1
< 6
MacBook Air
77
F6
&
7
Next
♡
F7
*
8
F8
(
9
Transcribed Image Text:Fixed costs Fixed overhead Fixed general and administrative Income A potential customer offers to buy 50,000 units for $3.20 each. These sales would not affect the company's sales through its normal channels. Details about the special offer follow. • Direct materials cost per unit and variable overhead cost per unit would not change. Direct labor cost per unit would be $0.54 because the offer would require overtime pay. Accepting the offer would require incremental fixed general and administrative costs of $5,000. Accepting the offer would require no incremental fixed overhead costs. Required: 1. Compute income from the special offer. 2. Should the company accept or reject the special offer? Required 1 Complete this question by entering your answers in the tabs below. 2 Should the company accept or reject the special offer? Should the company accept or reject the special offer? 20 Required 2 F2 0.20 0.15 $ 3.25 #3 80 F3 < Required 1 $ 4 F4 80,000 60,000 $ 1,300,000 15 % F5 Required 2 > Prev 1 of 1 < 6 MacBook Air 77 F6 & 7 Next ♡ F7 * 8 F8 ( 9
3 Assignment
ook
int
ences
O
F1
2
JART manufactures and sells underwater markers. Its contribution margin income statement follows.
For Year Ended December 31
Sales (400,000 units)
Variable costs
Direct materials
Direct labor
Variable overhead
Contribution margin
Fixed costs
Fixed overhead
Fixed general and administrative
Income
Contribution Margin Income Statement
Per Unit
$ 6.00
Required 1
Required:
1. Compute income from the special offer.
2. Should the company accept or reject the special offer?
2
A potential customer offers to buy 50,000 units for $3.20 each. These sales would not affect the company's sales through its normal
channels. Details about the special offer follow.
F2
W
Direct materials cost per unit and variable overhead cost per unit would not change.
Direct labor cost per unit would be $0.54 because the offer would require overtime pay.
Accepting the offer would require incremental fixed general and administrative costs of $5,000.
Accepting the offer would require no incremental fixed overhead costs.
Complete this question by entering your answers in the tabs below.
S
Required 2
#
Compute income from the special offer. (Round your "Per Unit" answers to 2 decimal places.)
Special Offer Analysis
3
80
F3
E
D
1.44
0.36
0.60
3.60
0.20
0.15
$ 3.25
$
4
Q
F4
R
F
Annual Total
$ 2,400,000
Per Unit
%
576,000
144,000
240,000
1,440,000
80,000
60,000
$ 1,300,000
LO
5
Saved
9
F5
Prev
6
Total
1 of 1
MacBook Air
F6
I
TY
IIE
&
7
G H
Next
F7
U
* 0
8
DII
F8
J
|
(
9
F9
K
O
O
Transcribed Image Text:3 Assignment ook int ences O F1 2 JART manufactures and sells underwater markers. Its contribution margin income statement follows. For Year Ended December 31 Sales (400,000 units) Variable costs Direct materials Direct labor Variable overhead Contribution margin Fixed costs Fixed overhead Fixed general and administrative Income Contribution Margin Income Statement Per Unit $ 6.00 Required 1 Required: 1. Compute income from the special offer. 2. Should the company accept or reject the special offer? 2 A potential customer offers to buy 50,000 units for $3.20 each. These sales would not affect the company's sales through its normal channels. Details about the special offer follow. F2 W Direct materials cost per unit and variable overhead cost per unit would not change. Direct labor cost per unit would be $0.54 because the offer would require overtime pay. Accepting the offer would require incremental fixed general and administrative costs of $5,000. Accepting the offer would require no incremental fixed overhead costs. Complete this question by entering your answers in the tabs below. S Required 2 # Compute income from the special offer. (Round your "Per Unit" answers to 2 decimal places.) Special Offer Analysis 3 80 F3 E D 1.44 0.36 0.60 3.60 0.20 0.15 $ 3.25 $ 4 Q F4 R F Annual Total $ 2,400,000 Per Unit % 576,000 144,000 240,000 1,440,000 80,000 60,000 $ 1,300,000 LO 5 Saved 9 F5 Prev 6 Total 1 of 1 MacBook Air F6 I TY IIE & 7 G H Next F7 U * 0 8 DII F8 J | ( 9 F9 K O O
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