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P26-1A ThreePoint Sports Inc. manufactures basketballs for the Women's National Basket- ball Association (WNBA). For the first 6 months of 2017, the company reported the
P26-1A ThreePoint Sports Inc. manufactures basketballs for the Women's National Basket- ball Association (WNBA). For the first 6 months of 2017, the company reported the follow- ing operating results while operating at 80% of plant capacity and producing 120,000 units. Sales Cost of goods sold Selling and administrative expenses Net income Amount $4,800,000 3,600,000 405,000 $ 795,000 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. (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? Use incremental analysis for special order and identify nonfinancial factors in the decision. (LO 2) (a) NI increase $37,500
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