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Question 3 (4 Marks) Sky Company manufactures cappuccino makers. For the first ten months of 2016, the company reported the following operating results while operating
Question 3 (4 Marks) Sky Company manufactures cappuccino makers. For the first ten months of 2016, the company reported the following operating results while operating at 80% of plant capacity Sales (500,000 units) Cost of goods sold Gross profit Operating expenses Net income $90,000,000 54,000,000 36,000,000 24.000,000 $12.000,000 An analysis of costs and expenses reveals that variable cost of goods sold is $85 per unit and variable operating expenses are S35 per unit In November, Sky Company receives a special order for 30,000 machines at $135 each from a major coffee shop franchise. Acceptance of the order would result in $10,000 of shipping costs but no increase in fixed expenses. Required (a) Prepare an incremental analysis for the special order (b) Should Sky Company accept the special order? Justify your
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