Question
Lattimer Company had the following results of operations for the past year: Contribution margin income statement Per Unit Annual Total Sales (18,300 units) $ 12.00
Lattimer Company had the following results of operations for the past year: Contribution margin income statement Per Unit Annual Total Sales (18,300 units) $ 12.00 $ 219,600 Variable costs Direct materials 1.50 27,450 Direct labor 4.00 73,200 Overhead 1.00 18,300 Contribution margin 5.50 100,650 Fixed costs Fixed overhead 1.00 18,300 Fixed selling and administrative expenses 1.40 25,620 Income $ 3.10 $ 56,730 A foreign company offers to buy 6,100 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 28,300 units. If Lattimer accepts this additional business, the special order will yield a:
A. $ 4,075 loss
B. $4,575 profit
C. $10,175 loss
D. $6100 profit
E. $2550 loss
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