Regular sales are not affected by the special order. There is a special order received for 2700 chairs at a price of $350 per unit. f the company decides to go ahead with the special order then fixed costs increase by $6,600, and variable marketing and administrative costs for that order are $1 per unit, f a special sales order is accepted how would operating income be affected? decrease of 222,000 increase of 287,700 increase of 81,000 increase of 296,000
Regular sales are not affected by the special order. There is a special order received for 2700 chairs at a price of $350 per unit. f the company decides to go ahead with the special order then fixed costs increase by $6,600, and variable marketing and administrative costs for that order are $1 per unit, f a special sales order is accepted how would operating income be affected? decrease of 222,000 increase of 287,700 increase of 81,000 increase of 296,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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PLease ASAP. and show calculations!!
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![Lego Company manufactures chairs. Annual maximum capacity is 100,000. It currently produces and sells 75,000 chairs per
year. The following information relates to current production:
Sale price per unit
$430
Variable costs per unit:
Manufacturing
Marketing and administrative
Total fixed costs:
Manufacturing
$240
$80
$760,000
$220,000
Marketing and administrative
Regular sales are not affected by the special order. There is a special order received for 2700 chairs at a price of $350 per unit.
If the company decides to go ahead with the special order then fixed costs increase by $6,600, and variable marketing and
administrative costs for that order are $1 per unit,
If a special sales order is accepted how would operating income be affected?
decrease of 222,000
increase of 287,700
increase of 81,000
increase of 296,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F49a84dba-b469-4ad9-acfc-af9addc4bec1%2Ff00eda92-91dc-4cde-8f49-e5284f01fbbd%2F801ehz_processed.png&w=3840&q=75)
Transcribed Image Text:Lego Company manufactures chairs. Annual maximum capacity is 100,000. It currently produces and sells 75,000 chairs per
year. The following information relates to current production:
Sale price per unit
$430
Variable costs per unit:
Manufacturing
Marketing and administrative
Total fixed costs:
Manufacturing
$240
$80
$760,000
$220,000
Marketing and administrative
Regular sales are not affected by the special order. There is a special order received for 2700 chairs at a price of $350 per unit.
If the company decides to go ahead with the special order then fixed costs increase by $6,600, and variable marketing and
administrative costs for that order are $1 per unit,
If a special sales order is accepted how would operating income be affected?
decrease of 222,000
increase of 287,700
increase of 81,000
increase of 296,000
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