Question
Lattimer Company had the following results of operations for the past year: Contribution margin income statement Per Unit Annual Total Sales (20,700 units) $ 12.00
Lattimer Company had the following results of operations for the past year: Contribution margin income statement Per Unit Annual Total Sales (20,700 units) $ 12.00 $ 248,400 Variable costs Direct materials 1.50 31,050 Direct labor 4.00 82,800 Overhead 1.00 20,700 Contribution margin 5.50 113,850 Fixed costs Fixed overhead 1.00 20,700 Fixed selling and administrative expenses 1.40 28,980 Income $ 3.10 $ 64,170 A foreign company offers to buy 6,900 units at $7.50 per unit. In addition to variable costs, selling these units would add a $0.25 selling expense for export fees. Lattimers annual production capacity is 30,700 units. If Lattimer accepts this additional business, the special order will yield a: Multiple Choice $2,950 loss. $11,575 loss. $5,175 profit. $4,675 loss. $6,900 profit.
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