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Just need some help solving this I will rate! Many thanks and God bless!!!! Voyage Sail Makers manufactures sails for sailboats. The company has the
Just need some help solving this
I will rate!
Many thanks and God bless!!!!
Voyage Sail Makers manufactures sails for sailboats. The company has the capacity to produce 36,000 sails per year and is currently producing and selling 25,000 sails per year. The following information relates to current production: Sales price per unit $180 Variable costs per unit: Manufacturing $60 Selling and administrative $10 Total fixed costs: Manufacturing $700,000 Selling and administrative $250,000 If a special pricing order is accepted for 5,700 sails at a sales price of $170 per unit, and fixed costs remain unchanged, what is the change in operating income? (Assume the special pricing order will require variable manufacturing costs and variable selling and administrative costs.) O A. Operating income decreases by S969,000. OB. Operating income increases by $969.000. OC. Operating income decreases by $570,000. OD. Operating income increases by $570,000. Head Bucket, Inc. has two product linesbatting helmets and football helmets. The income statement data for the most recent year is as follows: Total Batting Helmets Football Helmets Sales revenue $940,000 $600,000 $340,000 Variable costs (490,000) (200,000) (290,000) Contribution margin $450,000 $400,000 $50,000 Fixed costs (162,000) (70,000) (92,000) Operating income (loss) $288,000 $330,000 S(42,000) Assuming the football helmet line is dropped, total fixed costs remain unchanged, and the space formerly used to produce the football helmet line is used to double the production of batting helmets, operating income will be O A. $162,000 O B. $400,000 O C. $330,000 OD. $638,000Step by Step Solution
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