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The Calculate the impact on operating profits. I he Star Company has the capacity to produce 5,000 units per year. Its predicted operations for the
The Calculate the impact on operating profits. I he Star Company has the capacity to produce 5,000 units per year. Its predicted operations for the year are: Sales 4.000 units @ $20 each Manufacturing costs: Variable Fixed Marketing and administrative costs: Variable Fixed REQUIRED: a. Prepare a projected income statement for the coming year. b. Should the company accept a special order for 500 units at a selling price of $8? There are no variable marketing and administrative costs for this order and regular sales will not be affected. What is the impact of this decision on profits? c. Suppose there was a one-time set-up fee of $ 1,000 for the order above; should the special order be accepted? Why
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