Answered step by step
Verified Expert Solution
Question
1 Approved Answer
GCBelco Manufactunng produces and sells oil fiters or $3 30each A retailer has oftered to purchase 20DDers for $1 60 per filter. of the total
GCBelco Manufactunng produces and sells oil fiters or $3 30each A retailer has oftered to purchase 20DDers for $1 60 per filter. of the total manutacturing cost per fiter of $15, 8145 is the variable manufectuning cost per filter For this special orden GC8e co would nave to buyspecE stamping machine hat costs $7 500 to mark the customers logo on ne special order oil filters. The machine would be screpped when the special order s complete This special oder would use manu ac unng caps cit that would otherwise be idle. No variable nonmanufacturing costs would be incurred by the special order. Regular sales would not be affected by the special order. Would you recommend that GCBelco accept the special order under these conditions? Complete the folowing incremental analysis to help you make your recommendation Use parentheses or minus sign to Indicate decrease in operating income rom the spec a order Total Order Incremental Analysls of Speclal Sales Order Decislon Per Unit (20,000 unlts) Revenue fron spocial order Less variablc expensc associated with the crder Contribution margin Increase (decrease) in operating income from the special order GCBelco accept the special sales order because it will operating income
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