Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Pro Sports Inc. manufactures basketballs for professional basketball associations. For the first six months of 2020, the company reported the following operating results while operating

image text in transcribedimage text in transcribedimage text in transcribed

Pro Sports Inc. manufactures basketballs for professional basketball associations. For the first six months of 2020, the company reported the following operating results while operating at 90% of plant capacity: Amount Per Unit Sales $50.00 35.00 Cost of goods sold Selling and administrative expenses $4,860,000 3,402,000 437,400 $1,020,600 4.50 Net income $10.50 Fixed costs for the period were cost of goods sold of $972,000, and selling and administrative expenses of $174,960. In July, normally a slack manufacturing month, Pro Sports receives a special order for 9,720 basketballs at $31 each from the Italian Basketball Association. Accepting the order would increase variable selling and administrative expenses by $0.25 per unit because of shipping costs, but it would not increase fixed costs and expenses. Prepare an incremental analysis for the special order. (Round per unit calculations to 2 decimal places, e.g. 15.25 and final answers to O decimal places, e.g. 125.) Incremental revenue Incremental cost: Variable COGS Variable S & A Additional S & A Incremental income $ Should Pro Sports Inc. accept the special order? Pro Sports Inc. should the special order. LINK TO TEXT What is the minimum selling price on the special order to produce net income of $4.00 per ball? (Round answer to the 2 decimal places, e.g. 15.25.) Minimum selling price

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Strategic Cost Analysis

Authors: Roger Hussey

1st Edition

160649239X, 9781606492390

More Books

Students also viewed these Accounting questions