Oriole Sports Inc. manufactures basketballs for the Womens National Basketball Association (WNBA). For the first 6 months of 2022, the company reported the following operating results while operating at 80% of plant capacity and producing 120,100 units.

		Amount
Sales		$4,804,000
Cost of goods sold		3,503,718
Selling and administrative expenses		447,783
Net income		$852,499

Fixed costs for the period were cost of goods sold $960,000, and selling and administrative expenses $228,000. In July, normally a slack manufacturing month, Oriole Sports receives a special order for 10,000 basketballs at $27 each from the Greek Basketball Association (GBA). Acceptance of the order would increase variable selling and administrative expenses $0.73 per unit because of shipping costs but would not increase fixed costs and expenses.

(a) & (b)

• Your Answer
• Correct Answer (Used)

(a) Prepare an incremental analysis for the special order. (Round all per unit computations to 2 decimal places, e.g. 15.25. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

		Reject Order		Accept Order		Net Income Increase (Decrease)
Revenues		$enter a dollar amount		$enter a dollar amount		$enter a dollar amount
Cost of goods sold		enter a dollar amount		enter a dollar amount		enter a dollar amount
Selling and administrative expenses		enter a dollar amount		enter a dollar amount		enter a dollar amount
Net income		$enter a total net income amount		$enter a total net income amount		$enter a total net income amount

(b) Should Oriole Sports Inc. accept the special order? select an option YesNo

(c)

What is the minimum selling price on the special order to produce net income of $5.17 per ball? (Round answer to 2 decimal places, e.g. 15.25.)

Minimum selling price

$enter the minimum selling price in dollars rounded to 2 decimal places

eTextbook and Media

Save for Later

Attempts: 0 of 3 used

Submit Answer