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A company contemplating the acceptance of a special order has the following unit cost behavior, based on 10,000 units: Direct materials 4 Direct labor 10
A company contemplating the acceptance of a special order has the following unit cost behavior, based on 10,000 units: Direct materials 4 Direct labor 10 Variable overhead Fixed overhead 6 A foreign company wants to purchase 2,000 units at a special unit price of $25. The normal price per unit is $40. In addition, a special stamping machine will have to be purchased for $4,000 in order to stamp the foreign company's name on the product. The incremental income (loss) from accepting the order is a. $6,000 b. $2,000 c. $(6,000) d. $(2,000)
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