2.

Pope Company manufactures a variety of hiking boots and has received a special one-time-only order from a new customer. Pope has sufficient idle capacity to accept the special order to manufacture 1,200 pairs of boots at a price of $52.00 per pair. Popes normal selling price is $65.00 per pair of sneakers. Variable manufacturing costs are $35.00 per pair and fixed manufacturing costs are $12.00 a pair. Popes variable selling expense for its normal line of sneakers is $1.00 per pair.

What would the effect on Popes operating income be if the company accepted the special order?

When choosing an activity basis to measure in conducting cost behavior analysis, which of the following statements is not true?

Select one:

A. There should be a logical causal relationship between the cost and the driver.

B. The quantities of the driver and the costs should be highly correlated.

C. The cost of measuring the driver should not outweigh the benefit it provides.

D. A cost-volume graph may be useful in identifying an activity base.

E. All of the above are true.

Break-Even Calculations Compute the break-even point in units for each of the following independent situations: Unit Selling Price Unit Variable Cost Total Fixed Cost $45,000 b. 12 72,000 c. 5 27,000 $10 $7 Break-even Units Revenue A 0 $ 0 $ Pope's operating income would if the order was accepted