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View Policies Current Attempt in Progress Carla Vista Company produces golf discs which it normally sells to retailers for $7 each. The cost of manufacturing 23,600 golf discs is: Materials. Labor Variable overhead Fixed overhead Total $ 12,036 35,400 23,128 47,200 $117,764 Carla Vista also incurs 8% sales commission ($0.56) on each disc sold. McGee Corporation offers Carla Vista $4.90 per disc for 4,900 discs. McGee would sell the discs under its own brand name in foreign markets not yet served by Carla Vista. If Carla Vista accepts the offer, it will incur a one-time fixed cost of $6,500 due to the rental of an imprinting machine. No sales commission will result from the special order. Assume there is sufficient capacity to accommodate the special order.

View Policies Current Attempt in Progress Carla Vista Company produces golf discs which it normally sells to retailers for $7 each. The cost of manufacturing 23,600 golf discs is: Materials. Labor Variable overhead Fixed overhead Total $ 12,036 35,400 23,128 47,200 $117,764 Carla Vista also incurs 8% sales commission ($0.56) on each disc sold. McGee Corporation offers Carla Vista $4.90 per disc for 4,900 discs. McGee would sell the discs under its own brand name in foreign markets not yet served by Carla Vista. If Carla Vista accepts the offer, it will incur a one-time fixed cost of $6,500 due to the rental of an imprinting machine. No sales commission will result from the special order. Assume there is sufficient capacity to accommodate the special order.

Managerial Accounting
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter11: Differential Analysis And Product Pricing
Section: Chapter Questions
Problem 13E
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(b) Should Carla Vista accept the special order?

 

Carla Vista ............should the special order.

(a) Prepare an incremental analysis for the special order. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Revenues Materials Labor . Variable overhead Cost of equipment rental Net income Reject Order Accept Order Net Income Increase (Decrease)
Transcribed Image Text:(a) Prepare an incremental analysis for the special order. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Revenues Materials Labor . Variable overhead Cost of equipment rental Net income Reject Order Accept Order Net Income Increase (Decrease)
View Policies Current Attempt in Progress Carla Vista Company produces golf discs which it normally sells to retailers for $7 each. The cost of manufacturing 23,600 golf discs is: Materials. Labor Variable overhead Fixed overhead Total $ 12,036 35,400 23,128 47,200 $117,764 Carla Vista also incurs 8% sales commission ($0.56) on each disc sold. McGee Corporation offers Carla Vista $4.90 per disc for 4,900 discs. McGee would sell the discs under its own brand name in foreign markets not yet served by Carla Vista. If Carla Vista accepts the offer, it will incur a one-time fixed cost of $6,500 due to the rental of an imprinting machine. No sales commission will result from the special order. Assume there is sufficient capacity to accommodate the special order.
Transcribed Image Text:View Policies Current Attempt in Progress Carla Vista Company produces golf discs which it normally sells to retailers for $7 each. The cost of manufacturing 23,600 golf discs is: Materials. Labor Variable overhead Fixed overhead Total $ 12,036 35,400 23,128 47,200 $117,764 Carla Vista also incurs 8% sales commission ($0.56) on each disc sold. McGee Corporation offers Carla Vista $4.90 per disc for 4,900 discs. McGee would sell the discs under its own brand name in foreign markets not yet served by Carla Vista. If Carla Vista accepts the offer, it will incur a one-time fixed cost of $6,500 due to the rental of an imprinting machine. No sales commission will result from the special order. Assume there is sufficient capacity to accommodate the special order.
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