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Markson Company had the following results of operations for the past year: Contribution margin income statement Sales (12,000 units) Variable costs Direct materials Direct labor
Markson Company had the following results of operations for the past year: Contribution margin income statement Sales (12,000 units) Variable costs Direct materials Direct labor Overhead Contribution margin Fixed costs Fixed overhead Income Per Unit $ 20.00 Annual Total $ 240,000 4.25 51,000 6.00 72,000 2.00 24,000 7.75 93,000 4.25 51,000 $ 3.50 $ 42,000 A foreign company offers to buy 4,000 units at $14 per unit. In addition to variable manufacturing and administrative costs, selling these units would increase fixed overhead by $3,200 for the purchase of special tools. Markson's annual productive capacity is 18,000 units. If Markson accepts this additional business, its profits will: Multiple Choice Decrease by $3,200. Increase by $3,800. Decrease by $10,200. Increase by $7,000. Decrease by $12,650
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