ThreePoint Sports Inc. manufactures basketballs for the Women's National Basketball Association (WNBA). For the first 6 months of 2017, the company reported the following operating results while operating at 80% of plant capacity and producing 120,000 units. Amount 4,800,000 Sales 3,600,000 Cost of goods sold Selling and administrative expenses 405,000 795,000 Net income Fixed costs for the period were cost of goods sold 960,000, and selling and administrative expenses 225,000 In July, normally a slack manufacturing month, ThreePoint Sports receives a special order for 10,000 basketballs at 28 each from the Greek Basketball Association (GBA). Acceptance of the order would increase variable selling and administrative expenses $0.75 per unit because of shipping costs but would not increase fixed costs and expenses. Prepare an incremental analysis for the special order.
ThreePoint Sports Inc. manufactures basketballs for the Women's National Basketball Association (WNBA). For the first 6 months of 2017, the company reported the following operating results while operating at 80% of plant capacity and producing 120,000 units. Amount 4,800,000 Sales 3,600,000 Cost of goods sold Selling and administrative expenses 405,000 795,000 Net income Fixed costs for the period were cost of goods sold 960,000, and selling and administrative expenses 225,000 In July, normally a slack manufacturing month, ThreePoint Sports receives a special order for 10,000 basketballs at 28 each from the Greek Basketball Association (GBA). Acceptance of the order would increase variable selling and administrative expenses $0.75 per unit because of shipping costs but would not increase fixed costs and expenses.
Prepare an incremental analysis for the special order.
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