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Suppose the Baseball Hall of Fame in Cooperstown, New York, has approached Rec-Cardz with a special order. The Hall of Fame wishes to purchase 53,000
Suppose the Baseball Hall of Fame in Cooperstown, New York, has approached Rec-Cardz with a special order. The Hall of Fame wishes to purchase 53,000 baseball card packs for a special promotional campaign and offers $0.34 per pack, a total of $18,020. Rec - Cardz's total production cost is $0.54 per pack, as follows: E: (Click the icon to view the cost information.) Rec - Cardz has enough excess capacity to handle the special order. Read the requirements. Requirement 1. Prepare a differential analysis to determine whether Rec - Cardz should accept the special sales order. (Enter decreases to profits with a parentheses or minus sign.) i Data Table - X Expected increase in revenues Expected increase in expenses Variable manufacturing cost: packs xD Expected in operating income i Requirements - X 0.11 Variable costs: Direct materials Direct labor Variable overhead Fixed overhead Total cost 0.04 0.09 0.30 0.54 1. Prepare a differential analysis to determine whether Rec-Cardz should accept the special sales order. 2. Now assume that the Hall of Fame wants special hologram baseball cards. Rec-Cardz will spend $5,700 to develop this hologram, which will be useless after the special order is completed. Should Rec-Cardz accept the special order under these circumstances, assuming no change in the special pricing of $0.34 per pack? Print Done Print Done
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