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27. Jones Co, received an offer to buy 3,800 units of its product for $750 per unit. Jones Co normally produces 12,000 units but only
27. Jones Co, received an offer to buy 3,800 units of its product for $750 per unit. Jones Co normally produces 12,000 units but only plans to produce and sell 8,000 units in the coming year. The normal sales price is $12 per unit. Unit cost info is: Direct materials $2.00 Direct labor $3.10 Variable overhead $1.80 Fixed overhead $2.00 If Jones Co. accepts the order, no fixed manufacturing activities will be affected Should Jones Co accept the order? a Yes, because income will increase by c. No, because income will decrease by $5,320 $2,280 b. No, because income will decrease byd Yes, because income will increase by $5,320 $2.280 28. Refer to question 27 Jones Co's warchonse distribution center is operating at full capacity and would have to add capacity costing $1,000 for every 5,000 units to be packed and shipped Should Jones Co accept the special order? Yes, because income would increase No, because income would decrease by S6,320 by $3,280 b. No, because income would decrease d. Yes, because income would increase by S6,320 by $1,280
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