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Stells [14]
3 years ago
7

At Bargain Electronics, it costs $30 per unit ($20 variable and $10 fixed) to make an MP3 player at full capacity that normally

sells for $45. A foreign wholesaler offers to buy 3,000 units at $25 each. Bargain Electronics will incur special shipping costs of $3 per unit. Assuming that Bargain Electronics has excess operating capacity, indicate the net income (loss) Bargain Electronics would realize by accepting the special order. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
Business
1 answer:
butalik [34]3 years ago
3 0

Answer:

Net Income  Bargain Electronics would realize by accepting the special order is  - $ 24,000

Explanation:

Bargain Electronics is operating at full capacity, therefore the fixed costs are relevant at this decision.

<u>Incremental Costs and Revenues - Special Order 3000 units</u>

Sales ( 3000 × $25)                                     75,000

Variable Cost (3000× $20)                         (60,000)

Fixed Costs (3000× $10)                             (30,000)

Shipping Costs ( 3000×$3)                          (9,000)

Net Income                                                   -24,000

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A company begins a review of ordering policies for its continuous review system by checking the current policies for a sample of
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Answer:

Explanation:

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Then; total demand = 72 × 48 = 3456 units

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