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At MM Productions, it costs $98 per unit ($40 variable and $58 fixed) to make a headphone that normally sells for $150. A foreign
At MM Productions, it costs $98 per unit ($40 variable and $58 fixed) to make a headphone that normally sells for $150. A foreign wholesaler offers to buy 1,000 units at $105 each. MM Productions will incur special shipping costs of $1 per unit. Assuming that MM Productions has excess operating capacity, indicate the net income (loss) MM Productions would realize by accepting the special order. Hint: Fixed costs are not avoidable whether the special order is accepted or rejected. Therefore, they will not affect the company's net income. Do NOT enter a dollar sign. For example, if you are typing $10,000 as your answer, answer should be typed as 10,000 without any dollar sign. .For any negative amounts, enter them using either a negative sign preceding the number such as -50 or parentheses such as (50). .If the amount is zero, enter 0. Reject or Accept Net Income Reject Order Accept Order Increase (Decrease) Revenues Variable Manufacturing Costs $ 69 $ tA 40
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