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Cozy Products manufactures t-shirts. It has the following costs when its production level is 75,000 units (t-shirts): EEB Click the icon to view the costs.)
Cozy Products manufactures t-shirts. It has the following costs when its production level is 75,000 units (t-shirts): EEB Click the icon to view the costs.) What will happen to Cozy's operating income if it accepts this special order? (Click the icon to view additional information.) Data Table Complete the following incremental analysis to determine the impact on Cozy's operating income if it accepts this special order. (Round all per unit amounts whole dollar. Enter a "0" for any zero balances. Use parentheses or a minus sign to indicate a decrease in contribution margin and/or operating incomef Total Order Total costs for Per Unit 7,500 units) Incremental Analysis of Special Sales Order Decision 75,000 units Revenue from special order Less variable expense associated with the order Direct materials Direct labor Variable manufacturing overhead Contribution margin Less: Additional fixed expenses associated with the order Increase (decrease) in operating income from the special order 247,500 22,500 71,250 100,000 441,250 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total manufacturing costs More Into The company's relevant range extends to 87,500 units. Cozy has received a special order for 7,500 t-shirts at a special price of $52,500 for the entire order. The special order t-shirt would use a fabric that is less expensive than the standard fabric used by Cozy, which would allow Cozy to save $0.25 per t-shirt in direct materials when manufacturing this special order. Cozy has the excess capacity to manufacture this special order. Its total fixed costs will not be impacted by the Enter any number in the edit fields and then click Check Answer 1 remaining Clear AI
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