Questions 5 and 6 refer to the following information At the end of the year, a c

Question

Questions 5 and 6 refer to the following information At the end of the year, a company offered to buy 4,600 units of a product from X Company for a special price of $11.00 each instead of the company's regular price of $18.00 each. The following information relates to the 61,900 units of the product that X Company made and sold to its regular customers during the year: Cost of goods sold Period costs Total Per-Unit $8.56 2.56 Total $529,864 158,464 $11.12 $688,328 Fixed cost of goods sold for the year were137,418, and fixed period costs were 7 566. variable period costs include selling commissions equal to 4 of evenue. 5. Profit on the special order is $14,904 You are correct. Your receipt no. is 152-1056Previous Tries 6. Assume the following two changes for the special order: 1) variable cost of goods sold will decrease by $0.88 per unit, and 2) there will be no selling commissions. What will be the effect of these two changes on the special order profit? -2024 Submit Answer Incorrect. Tries 3/5 Previous Tries

Explanation / Answer

Dear Student Thank you for using Chegg Please find below the answer and please give thumbs up   Statementshowing Computations Paticulars Q5 Sales = 4600*11         50,600.00 Less Variable Expenses Cost of goods sold = (529864 - 137418)/61900 * 4600         29,164.00 period cost = (158464 - 70566)/61900*4600           6,532.00 Total variable cost         35,696.00 Contribution Margin         14,904.00 Fixed cost :   Cost of goods sold                        -   period cost                        -   Total fixed cost                        -   Profit from special order         14,904.00 Paticulars Q6a Sales = 4600*11         50,600.00 Less Variable Expenses Cost of goods sold = (529864 - 137418)/61900 * 4600 - 4600*.88 - 4600*11*4%         23,092.00 period cost = (158464 - 70566)/61900*4600           6,532.00 Total variable cost         29,624.00 Contribution Margin         20,976.00 Fixed cost :   Cost of goods sold                        -   period cost                        -   Total fixed cost                        -   Profit from special order         20,976.00 Special order profit would increase by 6,072 (20976 - 14904)

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