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The following operating information reports the results of Riverbed Companys production and sale of 12,500 air-conditioned motorcycle helmets last year. Based on early market forecasts,
The following operating information reports the results of Riverbed Companys production and sale of 12,500 air-conditioned motorcycle helmets last year. Based on early market forecasts, Riverbed expects the same results this year.
Sales | $1,942,000 | ||
Variable manufacturing expenses | 960,000 | ||
Fixed manufacturing expenses | 280,000 | ||
Variable selling and administrative expenses | 118,000 | ||
Fixed selling and administrative expenses | 224,000 |
The American Motorcycle Club has offered to purchase 2,000 helmets at a price of $100 each. Riverbed has sufficient idle capacity to fill the order, which would not affect the companys cost structure or regular sales. If Riverbed accepts this order, by how much will its income increase or decrease?
Operating income will ______ by $ _____ . |
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