Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Blossom Sports Inc. manufactures basketballs for the Women's National Basketball Association (WNBA). For the first 6 months of 2020, the company reported the following operating
Blossom Sports Inc. manufactures basketballs for the Women's National Basketball Association (WNBA). For the first 6 months of 2020, the company reported the following operating results while operating at 80% of plant capacity and producing 120,300 units. Amount Sales $4,691,700 Cost of goods sold 3,533,217 Selling and administrative expenses 509,209 Net income $649,274 Fixed costs for the period were cost of goods sold $960,000, and selling and administrative expenses $265,000. In July, normally a slack manufacturing month, Blossom Sports receives a special order for 10,000 basketballs at $28 each from the Greek Basketball Association (GBA). Acceptance of the order would increase variable selling and administrative expenses $0.73 per unit because of shipping costs but would not increase fixed costs and expenses.Your answer is correct. (a) Prepare an incremental analysis for the special order. (Round all per unit computations to 2 decimal places, e.g. 15.25. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Net Income Reject Accept Increase Order Order (Decrease) Revenues $ 280000 280,000.00 Cost of goods 213900 i -213,900 sold Selling and administrative -27600 i -27600 expenses Net income 38500 $ 38500 (b) Should Blossom Sports Inc. accept the special order? Yes v(c) What is the minimum selling price on the special order to produce net income of $5.08 per ball? (Round answer to 2 decimal places, e.g. 15.25.) Minimum selling price $
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started