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ThreePoint Sports Inc. manufactures basketballs for the Women's National Basketball Association (WNBA). For the first 6 months of 2020, the company reported the following operating
ThreePoint Sports Inc. manufactures basketballs for the Women's National Basketball Association (WNBA). For the first 6 months of 2020, the company reported the following operating results while operating at 80% of plant capacity and producing 118,500 units. Sales Cost of goods sold Selling and administrative expenses Net income Amount $4,503,000 3,448,500 402.750 $651.750 Fixed costs for the period were cost of goods sold $960,000, and selling and administrative expenses $225.000, In July, normally a slack manufacturing month. ThreePoint Sports receives a special order for 10,000 basketballs at $27 each from the Greek Basketball Association (GBA). Acceptance of the order would increase variable selling and administrative expenses $0.73 per unit because of shipping costs but would not increase fixed costs and expenses. (a) & (b) (a) Prepare an incremental analysis for the special order. (Round all per unit computations to 2 decimal places, eg. 15.25. Enter negative amounts using either a negative sign preceding the number eg. -45 or parentheses eg. (45) Reject Order Accept Net Income Increase (Decrease) Order Revenues Cost of goods sold Selling and administrative expenses Net income $ (b) Should ThreePoint Sports Inc accept the special order
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