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Oriole Company manufactures cappuccino makers. For the first eight months of 2022, the company reported the following operating results while operating at 80% of
Oriole Company manufactures cappuccino makers. For the first eight months of 2022, the company reported the following operating results while operating at 80% of plant capacity: Sales (440,000 units) $79,200,000 Cost of goods sold 47,520,000 Gross profit 31,680,000 Operating expenses 21,120,000 Net income $10,560,000 An analysis of costs and expenses reveals that variable cost of goods sold is $95 per unit and variable operating expenses are $35 per unit. In September, Oriole Company receives a special order for 35,200 machines at $135 each from a major coffee shop franchise. Acceptance of the order would result in $8,800 of shipping costs but no increase in fixed expenses. Prepare an incremental analysis for the special order. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45). Do not leave any field blank. Enter 0 for the amounts.) ORIOLE COMPANY Incremental Analysis Net Income Reject Order Accept Order Increase (Decrease) 4752000 4752000 3334000 -3334000 1240800 -1240800 177200 $ 177200 %24 %24 %24 %24 Should Oriole Company accept the special order? Oriole Compa accept the special order. should should not Save for Latek
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