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Answer to required A , B , C , D Mr. Zip Zoop manufactures basketballs for professional basketball associations. For the year 2020, the company
Answer to required A B C D
Mr. Zip Zoop manufactures basketballs for professional basketball associations. For the year 2020, the company reported the following operating results while operating at 90% of plant capacity: Sales Cost of goods sold Selling and administrative expenses Net income Amount $360,000 $990,000 Per Unit $50.00 $35.00 $4.00 $11.00 Fixed costs for the period were cost of goods sold of $900,000, and selling and administrative expenses of $ 162,000. In July, normally a slack manufacturing month, Mr. Zip Zoop receives a special order for 9,000 basketballs at $30 each from the Italian Basketball Association. Accepting the order would increase variable selling and administrative expenses by $0.50 per unit because of shipping costs, but it would not increase fixed costs and expenses. Required: A. Prepare an incremental analysis for the special order. B. Should Mr. Zip Zoop. accept the special order? C. What is the minimum selling price on the special order to produce net income of $5.00 per ball? D. The Italian basketball association has really picked up in popularity, even to the point where they are considering replacing soccer. As a result, the new order request is for 12,000 basketballs. Should Mr. Zip Zoop accept the new special order?
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