At Bargain Electronics, it costs $32 per unit ($20 variable and $12 fixed) to ma

Question

At Bargain Electronics, it costs $32 per unit ($20 variable and $12 fixed) to make an MP3 player at full capacity that normally sells for $53. A foreign wholesaler offers to buy 4,740 units at $26 each. Bargain Electronics will incur special shipping costs of $4 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).)

Brief Exercise 21-3 At Bargain Electronics, it costs $32 per unit ($20 variable and $12 fixed) to make an MP3 player at full capacity that normally sells for $53. A foreign wholesaler offers to buy 4,740 units at $26 each. Bargain Electronics will incur special shipping costs of $4 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).) Reject Order Accept Order Net Income Increase (Decrease) Revenues Costs-Manufacturing Shipping Net income The special order shouldb. accepted rejected LINK TO TEXT

Explanation / Answer

Dear Student Thank you for using Chegg Please find below the answer Statementshowing Computations Paticulars Reject Order Accept Order Net Income Increase (Decrease) Revenues                            -                123,240.00       123,240.00 Costs - Manufacturing                            -                  94,800.00          94,800.00 Shipping                            -                  18,960.00          18,960.00 Net income                            -                     9,480.00            9,480.00 The special order should be accepted as it will increase net income by $9,480

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