Question
9 Blartt Inc. manufactures basketballs for the National Basketball Association (NBA). For the first 6 months of 2020, the company reported the following operating results
9 Blartt Inc. manufactures basketballs for the National Basketball Association (NBA). For the first 6 months of 2020, the company reported the following operating results while operating at 75% of plant capacity. Per Unit Sales $100.00 Cost of goods sold 70.00 Amount $5,000,000 3,500,000 Selling and administrative expenses 400,000 8.00 Net income $22.00 $1,100,000 Fixed costs for the period were: Cost of goods sold $1,200,000, and selling and administrative expenses $100,000. In July, normally a slack manufacturing month, Blartt receives a special order for 12,000 basketballs at $75 each from the European Basketball Association (EBA). Acceptance of the order would increase variable selling and administrative expenses $0.50 per unit because of shipping costs but would not increase fixed costs and expenses. What is the effect of the acceptance decision on profit
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