Question
At Bargain Electronics, it costs $29 per unit ($15 variable and $14 fixed) to make an MP3 player at full capacity that normally sells for
At Bargain Electronics, it costs $29 per unit ($15 variable and $14 fixed) to make an MP3 player at full capacity that normally sells for $40. A foreign wholesaler offers to buy 3,200 units at $28 each. Bargain Electronics will incur special shipping costs of $2 per unit. Assuming that Bargain Electronics has excess operating capacity, indicate the net income (loss) Bargain Electronics would realize by accepting the special order. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
Reject Order | Accept Order | Net Income Increase (Decrease) | |||||
Revenues | $ | $ | $ | ||||
Costs-Manufacturing | |||||||
Shipping | |||||||
Net income | $ | $ | $ |
The special order should be rejectedaccepted . |
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