Total cost | Total fixed cost | Total variable cost |
Variable cost per unit ( Total variable cost / 119400 ) |
|
Cost of goods sold | 3509190 | 960000 | 2549190 | 21.35 |
Selling and administrative expenses | 513516 | 258000 | 255516 | 2.14 |
Variable selling and administrative expense per unit for special order = 2.14 + 0.73 | 2.87 |
(a) | |||
Reject Order | Accept Order | Net income increase (decrease) | |
Revenues |
0 |
270000 ( 10000*27 ) |
270000 |
Cost of goods sold |
0 |
213500 ( 10000*21.35 ) |
213500 |
Selling and administrative expenses |
0 |
28700 ( 10000*2.87 ) |
28700 |
Net income | 0 | 27800 | 27800 |
(b) |
Answer : Accept |
Explanation : As accepting the special order will increase the net income by 27800, the order should be accepted. |
a & b *Problem 7-1A a-b, c (Part Level Submission) (Video) VERSION ThreePoint Sports Inc, manufactures...
Problem 7-1A a-b, c (Video) ThreePoint Sports Inc. manufactures basketballs for the Women’s National Basketball Association (WNBA). For the first 6 months of 2020, the company reported the following operating results while operating at 80% of plant capacity and producing 120,000 units. Amount Sales$4,800,000 Cost of goods sold3,600,000 Selling and administrative expenses405,000 Net income$795,000 Fixed costs for the period were cost of goods sold $960,000, and selling and administrative expenses $225,000. In July, normally a slack manufacturing month, ThreePoint Sports...
ThreePoint Sports Inc. manufactures basketballs for the Women’s National Basketball Association (WNBA). For the first 6 months of 2020, the company reported the following operating results while operating at 80% of plant capacity and producing 119,400 units. Amount Sales $4,776,000 Cost of goods sold 3,509,190 Selling and administrative expenses 513,516 Net income $753,294 Fixed costs for the period were cost of goods sold $960,000, and selling and administrative expenses $258,000. In July, normally a slack manufacturing month, ThreePoint Sports receives...
Problem 20-1A (Part Level Submission) ThreePoint Sports Inc. manufactures basketballs for the Women’s National Basketball Association (WNBA). For the first 6 months of 2017, the company reported the following operating results while operating at 80% of plant capacity and producing 120,400 units. Amount Sales $4,816,000 Cost of goods sold 3,700,304 Selling and administrative expenses 492,084 Net income $623,612 Fixed costs for the period were cost of goods sold $960,000, and selling and administrative expenses $226,000. In July, normally a slack...
ThreePoint Sports Inc. manufactures basketballs for the Women’s National Basketball Association (WNBA). For the first 6 months of 2020, the company reported the following operating results while operating at 80% of plant capacity and producing 120,100 units. Amount Sales $4,804,000 Cost of goods sold 3,503,718 Selling and administrative expenses 447,783 Net income $852,499 Fixed costs for the period were cost of goods sold $960,000, and selling and administrative expenses $228,000. In July, normally a slack manufacturing month, ThreePoint Sports receives...
Problem 20-1A ThreePoint Sports Inc, manufactures basketballs for the Women's National Basketball Association (WNBA). For the first 6 months of 2017, the company reported the following operating results while operating at 80% of plant capacity and producing 119,900 units. Amount Sales $4,676,100 3,569,024 Cost of goods sold Selling and administrative expenses 443,437 Net income $663,639 Fixed costs for the period were cost of goods sold $960,000, and selling and administrative expenses $248,000. In July, normally a slack manufacturing month, ThreePoint...
Problem 21-1A ThreePoint Sports Inc. manufactures basketballs for the Women's National Basketball Association (WNBA). For the first 6 months of 2017, the company reported the following operating results while operating at 80% of plant capacity and producing 120,400 units. Sales Cost of goods sold Selling and administrative expenses Net income Amount $ 4,816,000 3,700,304 492,084 $ 623,612 Fixed costs for the period were cost of goods sold $ 960,000, and selling and administrative expenses $ 226,000. In July, normally a...
ThreePoint Sports Inc. manufactures basketballs for the Women’s National Basketball Association (WNBA). For the first 6 months of 2020, the company reported the following operating results while operating at 80% of plant capacity and producing 119,900 units. Amount Sales $4,676,100 Cost of goods sold 3,527,059 Selling and administrative expenses 482,601 Net income $666,440 Fixed costs for the period were cost of goods sold $960,000, and selling and administrative expenses $244,000. In July, normally a slack manufacturing month, ThreePoint Sports receives...
ThreePoint Sports Inc. manufactures basketballs for the Women’s National Basketball Association (WNBA). For the first 6 months of 2020, the company reported the following operating results while operating at 80% of plant capacity and producing 118,700 units. Amount Sales $4,748,000 Cost of goods sold 3,582,083 Selling and administrative expenses 503,262 Net income $662,655 Fixed costs for the period were cost of goods sold $960,000, and selling and administrative expenses $235,000. In July, normally a slack manufacturing month, ThreePoint Sports receives...
ThreePoint Sports Inc. manufactures basketballs for the Women's National Basketball Association (WNBA). For the first 6 months of 2020, the company reported the following operating results while operating at 80% of plant capacity and producing 119,300 units. Sales Cost of goods sold Selling and administrative expenses Net income Amount $4,533,400 3,513,020 508,495 $511,885 Fixed costs for the period were cost of goods sold $960,000, and selling and administrative expenses $252,000. In July, normally a slack manufacturing month, ThreePoint Sports receives...
ThreePoint Sports Inc. manufactures basketballs for the Women's National Basketball Association (WNBA). For the first 6 months of 2020, the company reported the following operating results while operating at 80% of plant capacity and producing 118,500 units. Sales Cost of goods sold Selling and administrative expenses Net income Amount $4,503,000 3,448,500 402,750 $651,750 Fixed costs for the period were cost of goods sold $960,000, and selling and administrative expenses $225,000. In July, normally a slack manufacturing month, ThreePoint Sports receives...