Answered step by step
Verified Expert Solution
Question
1 Approved Answer
pls do both !! Ayayai Manufacturing has an annual capacity of 85,500 units per year. Currently, the company is making and selling 79,000 units a
pls do both !! Ayayai Manufacturing has an annual capacity of 85,500 units per year. Currently, the company is making and selling 79,000 units a year. The normal sales price is $120 per wit, variable costs are $90 per unit, and total fixed expenses are $2,000,000. An out-of-state distributor has offered to buy 12,000 units at $105 per unit. Ayayai's cost structure should not change as a result of this special order. By how much will Ayayal's income change if the company accepts this order? Ayayai's operating income will by $ if it accepts the special order. Flint Company is a leading manufacturer of sunglasses. One of Flint's products protects the eyes from ultraviolet rays. An upscale sporting goods store has contacted Flint about purchasing 28,600 pairs of these sunglasses. Flint's unit manufacturing cost, based on full capacity of 241,000 units, is as follows: Flint also incurs selling and administrative expenses of $74,100 plus $2 per pair for sales commissions. The company has plenty of excess manufacturing capacity to use in manufacturing the sunglasses. Flint's normal price for these sunglasses is $40 per pair. The sporting goods store has offered to pay $34 per pair. Since the special order was initiated by the sporting goods store, no 3ales commission will be paid. What would be the effect on Flint's income if the special order were accepted? Flint's income will by 5
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started