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Marcotti Cupcakes bakes and sells a basic cupcake for $1.35. The cost of producing 645,000 cupcakes in the prior year was: Revenues $728,500 Direct materials
Marcotti Cupcakes bakes and sells a basic cupcake for $1.35. The cost of producing 645,000 cupcakes in the prior year was: Revenues $728,500 Direct materials $352,000 Direct labor $65,000 $130,000 Manufacturing overhead (fixed) Manufacturing overhead (variable) $84,000 At the start of the current year, Marcotti received a special order for 15,000 cupcakes to be sold for $1.20 per cupcake. To complete the order, the company must incur an additional $2,975 in total fixed costs to lease a special machine that will stamp the cupcakes with the customer's logo. This order will not affect any of Marcotti's other operations and it has excess capacity to fulfill the contract. Fill in the table below to calculate the differential profit that would result from accepting the special order. Round all entries to the nearest whole number. Differential Revenue Differential Costs: Direct Materials $ Direct Labor $ Manufacturing Overhead (fixed) $ Manufacturing Overhead (variable) $ Differential Profit $
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