Use the following information to answer questions (1-4):

Al-Quds company produces 40,000 units of a good (x) monthly, while it has a capacity to produce 50,000 units of this good. Revenues of 40,000 units equal 1,200,000 JD.

Variable manufacturing cost per unit equals 9.5 JD Fixed manufacturing cost per unit equals 5.5 JD Variable marketing cost per unit equals 6.0 JD Fixed marketing cost per unit equals 3.0 JD

A customer, Zaid, contacts Al-Quds company and offers to buy 7000 units of good (X) at 14 JD per unit. 1.All of the following costs are irrelevant except: (2 Points)

Fixed manufacturing costs

Variable marketing costs

Variable manufacturing costs

Fixed Marketing costs 2.Without the special order, the operating income per unit equals (JD)? (2 Points)

15

6

24

9 3.If Al-Quds company accepts the offer, then: (2 Points)

The increase of operating income equals 17,500 JD

The increase of operating income equals 10,500 JD

The increase of operating income equals 31,500 JD

The decrease of operating income equals 17,500 JD 4.The right decision for Al-Quds company is to: (2 Points)

Accept the offer

Reject the offer

The offer has no effect on operating income