Question
DynatechMetal Works received an offer from a big-box retail company to purchase3,600metal outdoor tables for $256each.DynatechMetal Works accountants determine that the following costs apply to
DynatechMetal Works received an offer from a big-box retail company to purchase3,600metal outdoor tables for $256each.DynatechMetal Works accountants determine that the following costs apply to the tables:
Direct material$160Direct labor60Manufacturing overhead84Total$304
Of the $84of overhead, $17is variable and $67relates to fixed costs. The $67of fixed overhead is allocated as $1.30per direct labor dollar.
(a)What will be the real effect on profit if the order is accepted?
The profit will
select an option
increase
decrease
by $
enter a dollar amount
.
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