Question
You have been approached by a foreign customer who wants to place an order for 15,000 units of Product C at P22.50 a unit. You
You have been approached by a foreign customer who wants to place an order for 15,000 units of Product C at P22.50 a unit. You currently sell this item for P39 a unit, and the item has a cost of P29 a unit. Further analysis reveals that you will not be paying sales commission of P2.50 a unit on this sales and its packaging requirement will save you an additional P1.50 per unit. However, the additional graphics required on this job will cost you P30,000. Note also that fixed costs amounting to P400,000 for the production of 50,000 units will not change. You decided to accept this order but another customer who buys an average of 2,000 units for the period wants to pay you P22.50 rather than the regular price of P39 a unit. Accepting the special order, the amount of profit will:
decrease by P52,500
increase by P52,500
increase by P19,500
increase by P16,500
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