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Help Marine Supply manufactures flotation vests in Atlanta, Georgia Marine Supply's contribution margin income statement for the most recent month contains the following data Click
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Marine Supply manufactures flotation vests in Atlanta, Georgia Marine Supply's contribution margin income statement for the most recent month contains the following data Click the icon to view the cost information) Suppose Overton Cruiselines wants to buy 4 700 vests from Marine Supply Acceptance of the order will not require any variable selling and administrative expenses. The special order will not affect fixed expenses. The Marine Supply plant has enough unused capacity to manufacture the additional vests Overton Cruiselines has offered 59 per vost, which is below the normal sale price of $15. Read the requirements Requirement 1. Prepare an incremental analysis to determine whether Marine Supply should accept this special sales order. (Enter a "O" for any zero balances Use parentheses or a minus sign to indicate a negative contribution margin andior a decrease in operating income from the special order) Total Order Incremental Analysis of Special Sales Order Decision Per Unit (4,700 units) Ravenue from special order Loss variable expense associated with the order Variable manufacturing costs Contribution margin Less: Additional fixed expenses associated with the order Increase (decrease) in operating income from the special order Decision B 1 Marine Supply 2 Contribution Margin Income Statement (Variable Costing) 3. For Sales Volume of 29,000 Units Total 4 $ 435,000 5 Sales revenue 116,000 106,000 $ GA 213,000 6 Less variable expenses 7 Variable manufacturing costs (DM, DL, Variable MOH) 8 Variable operating expenses (selling and administrative) 9 Contribution margin 10 Less fixed expenses. 11 Fixed manufacturing overhead 12 Fixed operating expenses (selling and administrative) 13 Operating income (loss) 127,000 86,000 $ 0 Step by Step Solution
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