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46) Endothon Company manufactures lamps. Strime, a large retail merchandiser, wants to buy 50,000 lamps from Endothon Company for $10 each. Endothon Company normally
46) Endothon Company manufactures lamps. Strime, a large retail merchandiser, wants to buy 50,000 lamps from Endothon Company for $10 each. Endothon Company normally sells 400,000 lamps a year at $15 each; its production capacity is a total of 430,000 units a year. Below is the production cost information for the lamps: Variable production costs per unit Fixed manufacturing overhead per unit $5 $7 $12 Total production cost per unit Total fixed manufacturing overhead costs will not change regardless of whether the special order is accepted. Strime has indicated that the company is not Interested in signing a contract for fewer than 50,000 lamps. By how much will Endothon Company's net income change if this special order is accepted? It will increase by $50,000. It will decrease by $50,000. It will increase by $100,000. It will decrease by $100,000.
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