The following cost functions apply to X Company's regular production and sales during the year:

Cost of goods sold: $6.84 (X) + $115,520

Selling and administrative expenses: $1.39 (X) + $75,392

where X is the number of units produced and sold. During the year, X Company sold 60,800 units for $17.00 each. At the end of the year, a company offered to buy 4,950 units but was only willing to pay $12.00 each. X Company had the capacity to produce the additional 4,950 units.

5. If X Company had accepted the special order, firm profits would have increased by

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6. Consider the following three changes. Direct material costs on the special order would have increased by $0.82 per unit, direct labor costs on the special order would have decreased by $0.38 per unit, and X Company would have had to rent special equipment for $1,000. Independent of your answer to (5), the effect of these changes would have been to reduce profit on the special order by

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7. In order to retain all of X Company's regular customers, it would have had to reduce the regular selling price by $0.49. If the selling price were reduced and next year's unit sales turned out to be the same as this year's sales, firm profits would have fallen by

The following cost functions apply to X Company's regular production and sales during the year: .Cost of goods sold: $6.84 (X) $115,520 .Selling and administrative expenses: $1.39 (X) $75,392 where X is the number of units produced and sold. During the year, X Company sold 60,800 units for $17.00 each. At the end of the year, a company offered to buy 4,950 units but was only willing to pay $12.00 each. X Company had the capacity to produce the additional 4,950 units 5. If X Company had accepted the special order, firm profits would have increased by Tries 0/3 6. Consider the following three changes. Direct material costs on the special order would have increased by $0.82 per unit, direct labor costs on the special order would have decreased by $0.38 per unit, and X Company would have had to rent special equipment for $1,000 Independent of your answer to (5), the effect of these changes would have been to reduce profit on the special order by *X* Tries 0/3 7. In order to retain all of X Company's regular customers, it would have had to reduce the regular selling price by $0.49. If the selling price were reduced and next year's unit sales turned out to be the same as this year's sales, firm profits would have fallen by Tries 0/3