Question
Product A is normally sold for $46 per unit. A special price of $30 is offered for the export market. The variable production cost is
Product A is normally sold for $46 per unit. A special price of $30 is offered for the export market. The variable production cost is $24 per unit. An additional export tariff of 13% of revenue must be paid for all export products. Assume there is sufficient capacity for the special order.
a. Prepare a differential analysis dated March 16 on whether to reject (Alternative 1) or accept (Alternative 2) the special order. If required, round your answers to two decimal places. If an amount is zero, enter "0".
Differential Analysis | |||
Reject Order (Alt. 1) or Accept Order (Alt. 2) | |||
March 16 | |||
Reject Order (Alternative 1) | Accept Order (Alternative 2) | Differential Effects (Alternative 2) | |
Revenues, per unit | $fill in the blank efb87906cff0072_1 | $fill in the blank efb87906cff0072_2 | $fill in the blank efb87906cff0072_3 |
Costs: | |||
Variable manufacturing costs, per unit | fill in the blank efb87906cff0072_4 | fill in the blank efb87906cff0072_5 | fill in the blank efb87906cff0072_6 |
Export tariff, per unit | fill in the blank efb87906cff0072_7 | fill in the blank efb87906cff0072_8 | fill in the blank efb87906cff0072_9 |
Profit (loss), per unit | $fill in the blank efb87906cff0072_10 | $fill in the blank efb87906cff0072_11 | $fill in the blank efb87906cff0072_12 |
b. Should the special order be rejected (Alternative 1) or accepted (Alternative 2)?
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