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Summer Fun manufactures flotation vests in Charlotte, North Carolina. Summer Fun's contribution margin income statement for the most recent month contains the following data: (Click
Summer Fun manufactures flotation vests in Charlotte, North Carolina. Summer Fun's contribution margin income statement for the most recent month contains the following data: (Click the icon to view the cost information.) Suppose Optimum Cruiselines wants to buy 5,400 vests from Summer Fun. Acceptance of the order will not require any variable selling and administrative expenses. The special order will not affect fixed expenses. The Summer Fun plant has enough unused capacity to manufacture the additional vests. Optimum Cruiselines has offered $8 per vest, which is below the normal sale price of $14. Read the requirements. Requirement 1. Prepare an incremental analysis to determine whether Summer Fun should accept this special sales order. (Enter a "0" for any zero balances. Use parentheses or a minus sign to indicate a negative contribution margin and/or a decrease in operating income from the.special order.) Data table tion margin income order will not require a he Summer Fun plant Summer Fun manufactures flotation vests in Charlotte, North Carolina. Summer Fun's contribution margin income statement for the most recent month contains the following data: (Click the icon to view the cost information.) Suppose Optimum Cruiselines wants to buy 5,400 vests from Summer Fun. Acceptance of the order will not require an variable sellinc and administrative exnenses. The snecial order will not affect fixed expenses. The Summer Fun plant as offered $8 per vest, which is Requirements 1. Prepare an incremental analysis to determine whether Summer Fun should accept this special sales order. 2. Identify long-term factors Summer Fun should consider in deciding whether to accept the special sales order. puld accept this special sales egative contribution margin Variable manufacturing costs Contribution margin Less: Additional fixed expenses associated with the order Increase (decrease) in operating income from the special order
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