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FURY produces and sells skateboards. Its contribution margin income statement follows. Contribution Margin Income Statement Per Unit $ 66.00 For Year Ended December 31 Sales (96,000 units) Variable costs Direct materials. Direct labor Variable overhead Contribution margin Fixed costs Fixed overhead Fixed general and administrative Income 35.00 9.00 12.00 10.00 3.00 2.00 $ 5.00 Annual Total $ 6,336,000 3,360,000 864,000 1,152,000 960,000 288,000 192,000 $ 480,000 A potential customer offers to buy 11,600 units for $58.00 each. These sales would not affect the company's sales through its normal channels. Details of the special offer follow. • Variable costs per unit would not change. • Accepting the offer would require incremental fixed overhead costs of $11,600. • Accepting the offer would require incremental fixed general and administrative costs of $17,400.

FURY produces and sells skateboards. Its contribution margin income statement follows. Contribution Margin Income Statement Per Unit $ 66.00 For Year Ended December 31 Sales (96,000 units) Variable costs Direct materials. Direct labor Variable overhead Contribution margin Fixed costs Fixed overhead Fixed general and administrative Income 35.00 9.00 12.00 10.00 3.00 2.00 $ 5.00 Annual Total $ 6,336,000 3,360,000 864,000 1,152,000 960,000 288,000 192,000 $ 480,000 A potential customer offers to buy 11,600 units for $58.00 each. These sales would not affect the company's sales through its normal channels. Details of the special offer follow. • Variable costs per unit would not change. • Accepting the offer would require incremental fixed overhead costs of $11,600. • Accepting the offer would require incremental fixed general and administrative costs of $17,400.

FINANCIAL ACCOUNTING
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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FURY produces and sells skateboards. Its contribution margin income statement follows. For Year Ended December 31 Sales (96,000 units) Variable costs Direct materials Direct labor Contribution Margin Income Statement Per Unit $ 66.00 Variable overhead Contribution margin Fixed costs Fixed overhead Fixed general and administrative Income 35.00 9.00 12.00 10.00 3.00 2.00 $ 5.00 Annual Total $ 6,336,000 3,360,000 864,000 1,152,000 960,000 288,000 192,000 $ 480,000 A potential customer offers to buy 11,600 units for $58.00 each. These sales would not affect the company's sales through its normal channels. Details of the special offer follow. • Variable costs per unit would not change. Accepting the offer would require incremental fixed overhead costs of $11,600. Accepting the offer would require incremental fixed general and administrative costs of $17,400.
Transcribed Image Text:FURY produces and sells skateboards. Its contribution margin income statement follows. For Year Ended December 31 Sales (96,000 units) Variable costs Direct materials Direct labor Contribution Margin Income Statement Per Unit $ 66.00 Variable overhead Contribution margin Fixed costs Fixed overhead Fixed general and administrative Income 35.00 9.00 12.00 10.00 3.00 2.00 $ 5.00 Annual Total $ 6,336,000 3,360,000 864,000 1,152,000 960,000 288,000 192,000 $ 480,000 A potential customer offers to buy 11,600 units for $58.00 each. These sales would not affect the company's sales through its normal channels. Details of the special offer follow. • Variable costs per unit would not change. Accepting the offer would require incremental fixed overhead costs of $11,600. Accepting the offer would require incremental fixed general and administrative costs of $17,400.
Required 1 Required 2 Compute income or loss from the special offer. (Round your "Per Unit" answers to 2 decimal places.) Special Offer Analysis Contribution margin Income (loss) $ Per Unit 0.00 0.00 $ Total 0 0
Transcribed Image Text:Required 1 Required 2 Compute income or loss from the special offer. (Round your "Per Unit" answers to 2 decimal places.) Special Offer Analysis Contribution margin Income (loss) $ Per Unit 0.00 0.00 $ Total 0 0
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