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Widget Inc. manufactures widgets. The company has the capacity to produce 100,000 widgets per year, but it currently produces and sells 75,000 widgets per year.
Widget Inc. manufactures widgets. The company has the capacity to produce 100,000 widgets per year, but it currently produces and sells 75,000 widgets per year. The following information relates to current production: EB (Click the icon to view the data) If a special sales order is accepted for 2,800 widgets at a price of $36 per unit, fixed costs increase by $9,000, and variable marketing and administrative costs for that order are $3 per unit, how would operating income be affected? (NOTE: Assume regular sales are not affected by the special order.) O A. Decrease by $19,000 O B. Increase by $19,000 C. Increase by $28,000 D. Increase by $27,400 Data Table Sale price per unit Variable costs per unit Marketing and administrative $43 $23 $4 Total fixed costs: Manufacturing Marketing and administrative $78,000 $23,000 Print Done Click to select your answer and then click Check
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