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At the end of the year, a company offered to buy 4,160 units of a product from X Company for $11.00 each instead of the
At the end of the year, a company offered to buy 4,160 units of a product from X Company for $11.00 each instead of the company's regular price of $17.00 each. The following income statement is for the 68,400 units of the product that X Company has already made and sold to its regular customers: $1,162,800 586,872 $575,928 Sales Cost of goods sold Gross margin Selling and administrative costs Profit 187,416 $388,512 For the year, variable cost of goods sold were $441,864, and variable selling and administrative costs were $99,864. The special order product has some unique features that will require additional material costs of $0.84 per unit and the rental of special equipment for $4,000. 4. Profit on the special order would be A: $2,530 B: $3,668 C: $5,318 OD: $7,712 E: $11,182 OF: $16,214 Submit Answer Tries 0/99 5. The marketing manager thinks that if X Company accepts the special order, regular customers will be lost unless the selling price for them is reduced by $0.19. The effect of reducing the selling price will be to decrease firm profits by A: $4,153 B: $5,524 OC: $7,347 OD: $9,771 OE: $12,996 OF: $17,285
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