Runner Corporation produces baseball bats for kids that it sells for $39 each. At capacity, the company can produce 54,000 bats a year. The costs of producing and selling 54,000 bats are as follows: (Click to view the costs.) Read the requirements. Requirement 1. Suppose Runner is currently producing and selling 30,000 bats. At this level of production and sales, its fixed costs are the same as given in the preceding table. Cobb Corporation wants to place a one-time special order for 24,000 bats at $26 each. Runner will incur no variable selling costs for this special order. Should Runner accept this one-time special order? Show your calculations. Determine the effect on operating income if the order is accepted. (Enter decreases in operating income with parentheses or a minus sign.) Increase (decrease) in operating income if order is accepted Data table Requirements 1. Suppose Runner is currently producing and selling 30,000 bats. At this level of production and sales, its fixed costs are the same as given in the preceding table. Cobb Corporation wants to place a one-time special order for 24,000 bats at $26 each. Runner will incur no variable selling costs for this special order. Should Runner accept this one-time special order? Show your calculations. 2. Now suppose Runner is currently producing and selling 54,000 bats. If Runner accepts Cobb's offer it will have to sell 24,000 fewer bats to its regular customers. (a) On financial considerations alone, should Runner accept this one-time special order? Show your calculations. (b) On financial considerations alone, at what price would Runner be indifferent between accepting the special order and continuing to sell to its regular customers at $39 per bat? (c) What other factors should Runner consider in deciding whether to accept the one-time special order? Runner Corporation produces baseball bats for kids that it sells for $39 each. At capacity, the company can produce 54,000 bats a year. The costs of producing and selling 54,000 bats are as follows: (Click to view the costs.) Read the requirements. Requirement 1. Suppose Runner is currently producing and selling 30,000 bats. At this level of production and sales, its fixed costs are the same as given in the preceding table. Cobb Corporation wants to place a one-time special order for 24,000 bats at $26 each. Runner will incur no variable selling costs for this special order. Should Runner accept this one-time special order? Show your calculations. Determine the effect on operating income if the order is accepted. (Enter decreases in operating income with parentheses or a minus sign.) Increase (decrease) in operating income if order is accepted Data table Requirements 1. Suppose Runner is currently producing and selling 30,000 bats. At this level of production and sales, its fixed costs are the same as given in the preceding table. Cobb Corporation wants to place a one-time special order for 24,000 bats at $26 each. Runner will incur no variable selling costs for this special order. Should Runner accept this one-time special order? Show your calculations. 2. Now suppose Runner is currently producing and selling 54,000 bats. If Runner accepts Cobb's offer it will have to sell 24,000 fewer bats to its regular customers. (a) On financial considerations alone, should Runner accept this one-time special order? Show your calculations. (b) On financial considerations alone, at what price would Runner be indifferent between accepting the special order and continuing to sell to its regular customers at $39 per bat? (c) What other factors should Runner consider in deciding whether to accept the one-time special order
