Miller Company produces speakers for home stereo units. The speakers are sold to retail stores for £30. Variable costs per unit are: Direct materials £9.00; Direct Distribution 1.50 and Variable Factory overhead 3.00. Fixed costs per month are: Factory overhead £120,000 and Selling and admin. 60,000. The variable distrib for transportation to the retail stores. The current production and sales volume is 20,000 per year. Capacity is 25,000 units per year. An Atlanta wholesaler has p place a special one-time order for 7,000 units at a special price of £25.20 per unit. The wholesaler would pay all distribution costs, but there would be additional and administrative costs of £6,000. In addition, assume that overtime production is not possible and that allother information remains the same as the original d on profits if the special order is accepted is Select one: a. cannot be determined b. £30,900 decrease c. £50,100 increase d. £30,900 increase
Miller Company produces speakers for home stereo units. The speakers are sold to retail stores for £30. Variable costs per unit are: Direct materials £9.00; Direct Distribution 1.50 and Variable Factory overhead 3.00. Fixed costs per month are: Factory overhead £120,000 and Selling and admin. 60,000. The variable distrib for transportation to the retail stores. The current production and sales volume is 20,000 per year. Capacity is 25,000 units per year. An Atlanta wholesaler has p place a special one-time order for 7,000 units at a special price of £25.20 per unit. The wholesaler would pay all distribution costs, but there would be additional and administrative costs of £6,000. In addition, assume that overtime production is not possible and that allother information remains the same as the original d on profits if the special order is accepted is Select one: a. cannot be determined b. £30,900 decrease c. £50,100 increase d. £30,900 increase
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 62P
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