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eBook Decision on Accepting Additional Business Country Jeans Co. has an annual plant capacity of 65,400 units, and current production is 45,200 units. Monthly fixed
eBook Decision on Accepting Additional Business Country Jeans Co. has an annual plant capacity of 65,400 units, and current production is 45,200 units. Monthly fixed costs are $41,500, and variable costs are $25 per unit. The present selling price is $36 per unit. On November 12 of the current year, the company received an offer from Miller Company for 13,600 units of the product at $27 each. Miller Company will market the units in a foreign country under its own brand name. The additional business is not expected to affect the domestic selling price or quantity of sales of Country Jeans Co. a. Prepare a differential analysis dated November 12 on whether to reject (Alternative 1) or accept (Alternative 2) the Miller order. If an amount is zero, enter zero "0". For those boxes in which you must enter subtracted or negative numbers use a minus sign. Differential Analysis Reject Order (Alt. 1) or Accept Order (Alt. 2) November 12 Reject Order Accept Order Differential Effect on Income (Alternative 1) (Alternative 2) Revenues Costs: Variable manufacturing costs 0 Income (Loss) Feedback 1,635,000 X (Alternative 2) Check My Work a. Subtract the additional costs from the additional revenues for accepting the order. Check My Work All work saved. Previous Save and Exit Submit Assignment for Grading
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