P20.1A (LO 2) ThreePoint Sports Inc. manufactures basketballs for the Women's National Basket-ball Association (WNBA). For the first 6 months of 2020, the company reported the following operating results while operating at 80% of plant capacity and pr

Fixed costs for the period were cost of goods sold $960,000, and selling and administrative expenses $225,000. In July, normally a slack manufacturing month, ThreePoint Sports receives a special order for 10,000 basketballs at $28 each from the Greek Basketball Association (GBA). Acceptance of the order would increase variable selling and administrative expenses $0.75 per unit because of shipping costs but would not increase fixed costs and expenses.

Instructions a. Prepare an incremental analysis for the special order. NI increase $37,500 b. Should ThreePoint Sports Inc. accept the special order? Explain your answer. c. What is the minimum selling price on the special order to produce net income of $5.00 per ball? d. What nonfinancial factors should management consider in making its decision?