Question
Problem 21-1A ThreePoint Sports Inc. manufactures basketballs for the Womens National Basketball Association (WNBA). For the first 6 months of 2017, the company reported the
Problem 21-1A ThreePoint Sports Inc. manufactures basketballs for the Womens National Basketball Association (WNBA). For the first 6 months of 2017, the company reported the following operating results while operating at 80% of plant capacity and producing 120,000 units. Amount Sales $ 4,680,000 Cost of goods sold 3,700,800 Selling and administrative expenses 532,400 Net income $ 446,800 Fixed costs for the period were cost of goods sold $ 960,000 , and selling and administrative expenses $ 260,000 . In July, normally a slack manufacturing month, ThreePoint 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 $ 0.75 per unit because of shipping costs but would not increase fixed costs and expenses.
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