Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Current Attempt in Progress Cullumber Industries manufactures and bottles energy drinks. Last year, the company made and bottled 2503000 units. Cullumber has the capacity to
Current Attempt in Progress Cullumber Industries manufactures and bottles energy drinks. Last year, the company made and bottled 2503000 units. Cullumber has the capacity to manufacture and bottle 3003000 units per year. Cullumber has received a special offer from a grocery chain for 503000 bottles with a special label to be sold as the house brand energy drink. Cullumber's normal selling price is $0.80 per bottle. The special offer is for $ 362160 total ($ 0.72/bottle). Management estimates that the variable cost per bottle is $0.34; fixed manufacturing overhead is $0.22/bottle. Of the fixed costs assigned to this special order, $ 2500 is for the special labels, the remainder is attributable to costs that will be incurred regardless of whether the special order is produced. What is the operating income generated by the special order? O $77980 $ 80480 O $191140 O $ 188640
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