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Beca Metal Works received an offer from a big-box retail company to purchase 2,580 metal outdoor tables for $188 each. Beca Metal Works accountants determine
Beca Metal Works received an offer from a big-box retail company to purchase 2,580 metal outdoor tables for $188 each. Beca Metal Works accountants determine that the following costs apply to the tables:
Direct material $109
Direct labor 43
Manufacturing overhead 60
Total $212
Of the $60 of overhead, $12 is variable and $48 relates to fixed costs. The $48 of fixed overhead is allocated as $0.96 per direct labor dollar. (
a) What will be the real effect on profit if the order is accepted?
The profit will ______ by $_____.
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