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Rowe Tool and Die (RTD) produces metal fittings as a supplier to various manufacturing firms in the area. The following is the forecasted income statement
Rowe Tool and Die (RTD) produces metal fittings as a supplier to various manufacturing firms in the area. The following is the forecasted income statement for the next quarter, which is the typical planning horizon used at RTD. RTD expects to sell 58,000 units during the quarter. RTD carries no inventories. Amount Per Unit Sales revenue $ 1,734,200 $ 29.90 Costs of fitting produced 1,310,800 22.60 Gross profit $ 423,400 $ 7.30 Administrative costs 304,500 5.25 Operating profit $ 118,900 $ 2.05 Fixed costs included in this income statement are $377,000 for depreciation on plant and machinery and miscellaneous factory operations and $101,000 for administrative costs. RTD has received a request for 10,000 fittings to be produced in the next quarter from
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