Moonbeam Company manufactures toasters. For the first 8 months of 2017, the comp

Question

Moonbeam Company manufactures toasters. For the first 8 months of 2017, the company reported the following operating results while operating at 75% of plant capacity: Sales (350,300 units) Cost of goods sold Gross profit Operating expenses Net income $4,380,000 2,590,000 1,790,000 839,200 $950,800 Cost of goods sold was 71% variable and 29% fixed; operating expenses were 81% variable and 19% fixed In September, Moonbeam Company receives a special order for 18,300 toasters at $7.67 each from Luna Company of Ciudad Juarez. Acceptance of the order would result in an additional $3,000 of shipping costs but no increase in fixed costs Prepare an incremental analysis for the special order. (Round computations for per unit cost to 4 decimal places, e.g. 15.2500 and all other computations and final answers to the nearest whole dollar, e.g. 5,725. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Reject Order Accept Order Net Income Increase (Decrease) Revenues Cost of goods sold Operating expenses Net income Should Moonbeam Company accept the special order? Moonbeam Company the special order

Explanation / Answer

Monobeam comany accept the special order

Reject Order Accept order Net income Increase (Decrease) Revenues 0                   140,361          140,361 (18300 X7.67) Cost of goods sold 0                     96,066            96,066 (18300*5.2495) Operating Expenses 0                     35,511            35,511 (18300*1.9405) Net Income 0                        8,784              8,784 Cost per unit Cost of Goods Sold 2,590,000 Varible 71% 1,838,900 5.2495 Operating Expenses 839,200 Variable 81% 679,752 1.9405

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