
Managerial Accounting
15th Edition
ISBN: 9781337912020
Author: Carl Warren, Ph.d. Cma William B. Tayler
Publisher: South-Western College Pub
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Transcribed Image Text:Accept Business at Special Price
Product D is normally sold for $43 per unit. A special price of $32 is offered for the export market. The variable production cost is $23 per unit. An additional
export tariff of 16% of revenue must be paid for all export products. Assume that there is sufficient capacity for the special order.
Prepare a differential analysis dated March 16, on whether to reject (Alternative 1) or accept (Alternative 2) the special order. If required, round your answers
to two decimal places. If an amount is zero, enter "0". For those boxes in which you must enter subtracted or negative numbers use a minus sign.
Differential Analysis
Reject Order (Alt. 1) or Accept Order (Alt. 2)
March 16
Differential Effect
on Income
(Alternative 2)
Reject Order
(Alternative 1) (Alternative 2)
Accept Order
Revenues, per unit
Costs:
Variable manufacturing costs, per unit
Export tariff, per unit
Reject the special order
Accept the special order
be rejected (Alternative 1) or accepted (Alternative 2)?
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