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Perry Industries has an annual plant capacity of 66,000 units, current production is 53,000 units per year. At the current production volume, the variable cost
Perry Industries has an annual plant capacity of 66,000 units, current production is 53,000 units per year. At the current production volume, the variable cost per unit is $28.00 and the fixed cost per unit is $390. The normal selling price of Perry's product is $5000 per unit. Porry has been asked by Dexter Company to fill a special order for 7,000 units of the product at a special sales price of $22.00 per unit. Dexter is located in a foreign country where Perry does not currently operate Dexter will market the units in its country under its own brand name, so the special order is not expected to have any effect on Perry's regular sales Read the requirements 2 Requirement 1. How would accepting the special order impact Perlys operating incomo? Should Perry accept the special order? Complete the following incremental analysis to determine the impact on Perry's operating income if it accepts this special order (Enter a "O" for any zoro balances. Use parentheses or a minus ign to indicato a decrease contribution margin and/or operating income from the special order) Total Order (7,000 Incremental Analysis of Special Sales Order Decision units) Revenue from special order Loss expenses associated with the order Less: Variable manufacturing cost Contribution margin Less: Additional fixed expenses associated with the order Increase (decrease) in operating income from the special order 0 lo Enter any number in the edit fields and then click Check Answer Clear All Check Answer 3 parts remaining
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