Question
UliMetal Works received an offer from a big-box retail company to purchase2,640metal outdoor tables for $192each.UliMetal Works accountants determine that the following costs apply to
UliMetal Works received an offer from a big-box retail company to purchase2,640metal outdoor tables for $192each.UliMetal Works accountants determine that the following costs apply to the tables:
Direct material$112Direct labor44Manufacturing overhead61Total$217
Of the $61of overhead, $12is variable and $49relates to fixed costs. The $49of fixed overhead is allocated as $0.98per direct labor dollar.
(a)What will be the real effect on profit if the order is accepted?
The profit will
select an option
increase
decrease
by $
enter a dollar amount
.
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