Lattimer Company had the following results of operations for the past year: Sales (15,000 units at $11.60) Variable manufacturing costs Fixed manufacturing costs $174,000 $91,500 $15,000 Selling and administrative expenses (all fixed) $30,000 ($136,500) Operating income $37,500 A foreign company whose sales will not affect Lattimer's market offers to buy 4,200 units at $6.70 per unit. In addition to existing costs, selling these units would add a $0.17 selling cost for export-fees. If Lattimer accepts this additional business, the special order will yield a: a. $1,806 profit b. $2,520 profit c. $1,680 loss d. $6,594 loss e. $2,394 loss

Lattimer Company had the following results of operations for the past year: Sales (15,000 units at $11.60) Variable manufacturing costs Fixed manufacturing costs $174,000 $91,500 $15,000 Selling and administrative expenses (all fixed) $30,000 ($136,500) Operating income $37,500 A foreign company whose sales will not affect Lattimer's market offers to buy 4,200 units at $6.70 per unit. In addition to existing costs, selling these units would add a $0.17 selling cost for export-fees. If Lattimer accepts this additional business, the special order will yield a: a. $1,806 profit b. $2,520 profit c. $1,680 loss d. $6,594 loss e. $2,394 loss

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter10: Cost Analysis For Management Decision Making

Section: Chapter Questions

Problem 16E

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Similar questions

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