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Last year, X Company sold 63,500 units of its only product for $19.00 each. Total costs were as follows: Cost of goods sold Variable $436,245
Last year, X Company sold 63,500 units of its only product for $19.00 each. Total costs were as follows:
Cost of goods sold | |
Variable | $436,245 |
Fixed | 141,605 |
Selling and administrative | |
Variable | $79,375 |
Fixed | 90,170 |
At the end of the year, a company offered to buy 4,930 units of the product but only for $12.00 each. X Company had the capacity to produce the additional units, and even though there would have been no additional selling and administrative costs, it rejected the offer. 1. If X Company had accepted the special order, firm profits would have increased by __________?
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