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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: Sales price per unit $40 Variable costs per unit Manufacturing Marketing and administrative $22 $5 Total fixed costs: $78,000 $25,000 Manufacturing Marketing and administrative If a snecial eales order is accented for 6.900 widoets at a.price.of $42.ner.unit and fixed.costs.remain unchanned how would oneratinn income.he affected2.(NOTE Decrease by $103,500 OA. O B. Increase by $103,500 O C. Increase by $2,500,000 O D. Increase by $289,800 ILIUW au tdera w cune1 UuuaU $40 Sales price per unit Variable costs per unit Manufacturing Marketing and administrative $22 $5 Total fixed costs: Manufacturing Marketing and administrative $78,000 $25,000 If a special sales order is accepted for 6,900 widgets at a price of $42 per unit, and fixed costs remain unchanged, how would operating income be affected? (NOTE Assume regular sales are not affected by the special order.) A. Decrease by $103,500 B. Increase by $103,500 C. Increase by $2,500,000 O D. Increase by $289,800
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