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Bluebird Mfg. has received a special one-time order for 15,000 bird feeders at $2.10 per unit. Bluebird currently produces and sells 75,000 units at $6.10
Bluebird Mfg. has received a special one-time order for 15,000 bird feeders at $2.10 per unit. Bluebird currently produces and sells 75,000 units at $6.10 each. This level represents 80% of its capacity. Production costs for these units are $3.45 per unit, which includes $1.80 variable cost and $1.65 fixed cost. If Bluebird accepts this additional business, the effect on net income will be:
$31,500 increase.
$4,500 increase.
$27,000 increase.
$20,250 decrease.
$27,000 decrease.
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