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Cullumber Inc. manufactures basketballs for the Women's National Basketball Association (WNBA). For the first 6 months of 2022, the company reported the following operating
Cullumber Inc. manufactures basketballs for the Women's National Basketball Association (WNBA). For the first 6 months of 2022, the company reported the following operating results while operating at 80% of plant capacity and producing 119,700 units. Sales Cost of goods sold Selling and administrative expenses Net income Amount $4,788,000 3,559,884 468,445 $759,671 Fixed costs for the period were cost of goods sold $960,000, and selling and administrative expenses $247,000. In July, normally a slack manufacturing month, Cullumber receives a special order for 10,000 basketballs at $29 each from the Greek Basketball Association (GBA). Acceptance of the order would increase variable selling and administrative expenses $0.75 per unit because of shipping costs but would not increase fixed costs and expenses. (a) & (b) Your answer is partially 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 eg-45 or parentheses eg. (45).) Reject Order Revenues $ Cost of goods sold Selling and administrative expenses Accept Order $ 290000 $ 0 217200 0 26000 Net Income Increase (Decrease) 290000 (217200) (26000) Net income 0 (533,200) 46800
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