Question
Dunder Mifflin sells all its paper at the following prices, with the following costs: Sale price per unit: $150 Variable costs per unit: Manufacuring: $90
Dunder Mifflin sells all its paper at the following prices, with the following costs:
Sale price per unit: $150
Variable costs per unit:
Manufacuring: $90
Marketing: $25
Fixed Costs:
Manufacturing: $1,000,000
Marketing: $80,000
How would operating income be affected if Dunder Mifflin accepts a special order of 5,000 units at a price of $130? Assume Dunder Mifflin has the capacity to produce the additional units; it still markets the new product; and its fixed costs will not change with the acceptance of the order.
Group of answer choices
Decrease $100,000
Increase $525,000
Increase $750,000
Increase $75,000
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