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ThreePoint Sports Inc. manufactures basketballs for the Womens National Basketball Association (WNBA). For the first 6 months of 2020, the company reported the following operating

ThreePoint Sports Inc. manufactures basketballs for the Womens 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 119,500 units.

Amount
Sales $4,660,500
Cost of goods sold 3,675,040
Selling and administrative expenses 516,825
Net income $468,635

Fixed costs for the period were cost of goods sold $960,000, and selling and administrative expenses $236,000. 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 $0.77 per unit because of shipping costs but would not increase fixed costs and expenses.

Partially correct answer iconYour answer is partially correct.

(a) Prepare an incremental analysis for the special order. (Round all per unit computations to 2 decimal places, e.g. 15.25. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

Reject Order Accept Order Net Income Increase (Decrease)
Revenues $ $ $
Cost of goods sold
Selling and administrative expenses
Net income $ $ $

(b) Should ThreePoint Sports Inc. accept the special order?

What is the minimum selling price on the special order to produce net income of $5.15 per ball? (Round answer to 2 decimal places, e.g. 15.25.)

Minimum selling price $ ?

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