Question
Benjamin Company had the following results of operations for the past year: Sales (16,000 units at $10) $160,000 Direct materials and direct labor $84,000 Overhead
Benjamin Company had the following results of operations for the past year:
| Sales (16,000 units at $10) |
| $160,000 |
| Direct materials and direct labor | $84,000 |
|
| Overhead (20% variable) | 24,000 |
|
| Selling and administrative expenses (all fixed) | 32,000 | (140,000) |
| Operating income |
| $ 20,000 |
A foreign company (whose sales will not affect Benjamin's market) offers to buy 4,000 units at $8.00 per unit. In addition to variable manufacturing costs, selling these units would increase fixed overhead by $1.900 and selling and administrative costs by $1.700.
Assuming Benjamin has excess capacity and accepts the offer, its total profits will beAnswer
DON'T USE COMMA SEPARATORS
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