Goody Buy Electronics has received an offer from a customer for $6,000 to purchase 12,000 external hard drives. Good Buy has budgeted sales of 800,000 hard drives totaling $500,000, with fixed costs of $260,000 and total costs of $420,000. Assuming that Good Buy has the capacity to produce the additional units and that accepting this order will not affect any other orders, what effect will accepting the order have on Good Buy’s profit? Incremental profit will increase by $6,000 Incremental profit will decrease by $6,000 Incremental profit will decrease by $3,600 Incremental profit will increase by $3,600 Incremental profit will increase by $6,300
Goody Buy Electronics has received an offer from a customer for $6,000 to purchase 12,000 external hard drives. Good Buy has budgeted sales of 800,000 hard drives totaling $500,000, with fixed costs of $260,000 and total costs of $420,000. Assuming that Good Buy has the capacity to produce the additional units and that accepting this order will not affect any other orders, what effect will accepting the order have on Good Buy’s profit? Incremental profit will increase by $6,000 Incremental profit will decrease by $6,000 Incremental profit will decrease by $3,600 Incremental profit will increase by $3,600 Incremental profit will increase by $6,300
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Goody Buy Electronics has received an offer from a customer for $6,000 to purchase 12,000 external hard drives. Good Buy has budgeted sales of 800,000 hard drives totaling $500,000, with fixed costs of $260,000 and total costs of $420,000. Assuming that Good Buy has the capacity to produce the additional units and that accepting this order will not affect any other orders, what effect will accepting the order have on Good Buy’s profit?
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Incremental profit will increase by $6,000 |
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Incremental profit will decrease by $6,000 |
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Incremental profit will decrease by $3,600 |
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Incremental profit will increase by $3,600 |
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Incremental profit will increase by $6,300 |
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