Question
During the year, X Company produced and sold 64,600 units of one of its products. The following is the related revenue and cost information: Revenue
During the year, X Company produced and sold 64,600 units of one of its products. The following is the related revenue and cost information:
Revenue | $1,227,400 | ||
Cost of goods sold | 555,560 | ||
Selling and administrative costs | 270,028 | ||
Profit | $401,812 |
Total variable cost of goods sold were $436,696, and total variable selling and administrative costs were $183,464.
At the end of the year, a company offered to buy 4,230 units but was only willing to pay $12.00 each.
4. If X Company had accepted the special order, firm profits would have increased by
A: $7,951 | B: $8,984 | C: $10,152 | D: $11,472 | E: $12,963 | F: $14,648 |
Tries 0/99 |
5. There is concern that regular customers will find out about the special order, and in order to retain all of the X Company's regular customers, the regular selling price would have to be reduced by $0.47. If the selling price were reduced and next year's unit sales turn out to be the same as this year's sales, firm profits would fall by
A: $12,436 | B: $15,545 | C: $19,432 | D: $24,290 | E: $30,362 | F: $37,952 |
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