XYZ Manufacturing normally produces and sells computer cases for $45 each. The variable cost per unit is $22, and allocated fixed overhead is $8 per unit. A distributor from Brazil approaches XYZ with an offer to buy 2,000 cases at $28 per unit. XYZ has sufficient excess capacity to handle this order without affecting regular sales or incurring additional fixed costs. What would be the impact on XYZ's net income if they accept this special order?

XYZ Manufacturing normally produces and sells computer cases for $45 each. The variable cost per unit is $22, and allocated fixed overhead is $8 per unit. A distributor from Brazil approaches XYZ with an offer to buy 2,000 cases at $28 per unit. XYZ has sufficient excess capacity to handle this order without affecting regular sales or incurring additional fixed costs. What would be the impact on XYZ's net income if they accept this special order?

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter7: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 58P: Polaris Inc. manufactures two types of metal stampings for the automobile industry: door handles and...

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