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Crane Company manufactures toasters. For the first 8 months of 2022, the company reported the following operating results while operating at 75% of plant capacity:

Crane Company manufactures toasters. For the first 8 months of 2022, the company reported the following operating results while operating at 75% of plant capacity:

Sales (364,000 units)

$4,371,000

Cost of goods sold

2,589,600

Gross profit

1,781,400

Operating expenses

841,750

Net income

$939,650

Cost of goods sold was 70% variable and 30% fixed; operating expenses were 80% variable and 20% fixed. In September, Crane receives a special order for 18,600 toasters at $7.95 each from Luna Company of Ciudad Juarez. Acceptance of the order would result in an additional $3,000 of shipping costs but no increase in fixed costs. (a) Prepare an incremental analysis for the special order. (Round computations for per unit cost to 2 decimal places, e.g. 15.25 and all other computations and final answers to the nearest whole dollar, e.g. 5,725. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

Reject Order Accept Order Net Income Increase (Decrease)
Revenues $enter a dollar amount $enter a dollar amount $enter a dollar amount
Cost of goods sold enter a dollar amount enter a dollar amount enter a dollar amount
Operating expenses enter a dollar amount enter a dollar amount enter a dollar amount
Net income $enter a total dollar amount $enter a total dollar amount $enter a total dollar amount

(b) Should Crane accept the special order?

Crane Company select an option should rejectshould accept the special order.

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