Prepare an incremental analysis for the special order. (Round computations for per unit cost to 2 decimal places, e.g. 15.25 and all other computations and final answers to the nearest whole dollar, e.g. 5,725. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

Principles of Cost Accounting
17th Edition
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Edward J. Vanderbeck, Maria R. Mitchell
Chapter10: Cost Analysis For Management Decision Making
Section: Chapter Questions
Problem 16E
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Cullumber Company manufactures toasters. For the first 8 months of 2022, the company reported the following operating results
while operating at 75% of plant capacity:
Sales (358,400 units)
Cost of goods sold
Gross profit
Operating expenses
Net income
(a)
Cost of goods sold was 70% variable and 30% fixed; operating expenses were 80% variable and 20% fixed.
In September, Cullumber receives a special order for 24.500 toasters at $8.38 each from Luna Company of Ciudad Juarez.
Acceptance of the order would result in an additional $2,900 of shipping costs but no increase in fixed costs.
Revenues
Prepare an incremental analysis for the special order. (Round computations for per unit cost to 2 decimal places, e.g. 15.25 and all other
computations and final answers to the nearest whole dollar, e.g. 5,725. Enter negative amounts using either a negative sign preceding the
number e.g. -45 or parentheses e.g. (45).)
Cost of goods sold
Operating expenses
$4,377.000
2,590,720
1,786.280
837.760
Net income
(b)
$948.520
LA
$
Reject
Order
4377000.00
2590720.00
83760.00
948520.00
Should Cullumber accept the special order?
+A
Cullumber Company should accept the special order.
Accept
Order
4582310.00
2714690.00
886475.00
981145.00
GA
Net Income
Increase
(Decrease)
205310.00
-123970.00
-48715.00
32625.00
Transcribed Image Text:Cullumber Company manufactures toasters. For the first 8 months of 2022, the company reported the following operating results while operating at 75% of plant capacity: Sales (358,400 units) Cost of goods sold Gross profit Operating expenses Net income (a) Cost of goods sold was 70% variable and 30% fixed; operating expenses were 80% variable and 20% fixed. In September, Cullumber receives a special order for 24.500 toasters at $8.38 each from Luna Company of Ciudad Juarez. Acceptance of the order would result in an additional $2,900 of shipping costs but no increase in fixed costs. Revenues Prepare an incremental analysis for the special order. (Round computations for per unit cost to 2 decimal places, e.g. 15.25 and all other computations and final answers to the nearest whole dollar, e.g. 5,725. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Cost of goods sold Operating expenses $4,377.000 2,590,720 1,786.280 837.760 Net income (b) $948.520 LA $ Reject Order 4377000.00 2590720.00 83760.00 948520.00 Should Cullumber accept the special order? +A Cullumber Company should accept the special order. Accept Order 4582310.00 2714690.00 886475.00 981145.00 GA Net Income Increase (Decrease) 205310.00 -123970.00 -48715.00 32625.00
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