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AB Inc. currently produces a product with the following cost characteristics: Selling price $93 Variable costs production 37 Variable costs S&A 13 Total fixed costs
AB Inc. currently produces a product with the following cost characteristics:
| Selling price | $93 |
| Variable costs production | 37 |
| Variable costs S&A | 13 |
| Total fixed costs | $907968 |
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| |
| Plant capacity | 42189 |
| Current product/sales volume | 35123 |
A customer approaches AB Inc. for a special one-time order to purchase 10229 units at a special price of $78 per unit. No variable selling and administrative costs would be incurred on this special order.
What would be the incremental income to AB Inc. if it were to accept this special order?
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