Question
Raspberry Delights produces and sells 65,000 cases annually. Cost breakdown: Variable production costs: $21 per case Fixed production costs: $8 per case Variable selling costs:
Raspberry Delights produces and sells 65,000 cases annually. Cost breakdown:
Variable production costs: $21 per case
Fixed production costs: $8 per case
Variable selling costs: $6 per case
Fixed selling and administrative costs: $5 per case
Total annual costs: $40 per case
Raspberry Delights marks up its prices 25% over full costs. With a surplus capacity of 18,000 cases, a Spanish retailer has offered to purchase 15,000 cases at $50 per case. Additional shipping and selling costs are $4 per case. Prepare the owner's equity statement reflecting the impact of this order.
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