Exercise 4 Golf Co made 3,000 novelty golf balls last year. The balls normally sell for...
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Exercise 4 Golf Co made 3,000 novelty golf balls last year. The balls normally sell for $7 each. The costs per ball were as follows: Direct materials Direct labor Overhead Selling expenses Total cost per ball $1.00 $0.50 $4.00 $0.50 $6.00 This year an overseas company approached Golf Co and asked them to sell an 900 golf balls at $6 each. The sale isn't expected to affect current sales. Most of Golf Co's overhead is fixed, but variable overhead costs are $1.2 per unit. Selling expenses will increase to $1.10 per unit on the special order. Complete the table to determine the incremental profit on the order. Sales Direct materials Direct labor Overhead Selling expenses Profit Accept Reject X X X X X X X X X X X X What is the incremental profit on the order? X Should Golf Co accept the order? X Exercise 4 Golf Co made 3,000 novelty golf balls last year. The balls normally sell for $7 each. The costs per ball were as follows: Direct materials Direct labor Overhead Selling expenses Total cost per ball $1.00 $0.50 $4.00 $0.50 $6.00 This year an overseas company approached Golf Co and asked them to sell an 900 golf balls at $6 each. The sale isn't expected to affect current sales. Most of Golf Co's overhead is fixed, but variable overhead costs are $1.2 per unit. Selling expenses will increase to $1.10 per unit on the special order. Complete the table to determine the incremental profit on the order. Sales Direct materials Direct labor Overhead Selling expenses Profit Accept Reject X X X X X X X X X X X X What is the incremental profit on the order? X Should Golf Co accept the order? X
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