Question

varazz mad unoagmozouo vapaUILy oTIanaio tro poia orc. i Data Table Requirements 0.0 1. Prepare an incremental analysis to determine whether Rec- Cardz should accept the special sales order assuming fixed costs would not be affected by the special order. Variable costs: $ Direct materials 0.13 2. Now assume that the Hall of Fame wants special hologram baseball cards. Rec Cardz must spend $5,100 to develop this hologram, which will be useless after the special order is completed. Should Rec - Cardz accept the special order under these circumstances? Show your analysis Direct labor 0.07 Variable overhead 0.10 aseballd ircumsta 0.25 in Fixed overhead 0.55 Total cost Done Print er Unit Print Done

Answer 1

Ans 1 Total Order 55000 units) $19,250 Incremental Analysis of special order decision Per unit Revenue from special order $0.35 Less: Variable expenses associated with the order Variable manufacturing costs $0.30 Contribution margin Less: Additional fixed expense associated with the order Increase/ (decrease) in operating income from the special order|| Decision : Accept the special sales order $16,500 $2,750 $2,750 Ans 2 Per unit $0.35 Total Order 55000 units) $19,250 $0.30 Incremental Analysis of special order decision Revenue from special order Less: Variable expenses associated with the order Variable manufacturing costs Contribution margin Less: Additional fixed expense associated with the order Increase / (decrease) in operating income from the special order Decision : Reject the special sales order $16,500 $2,750 $5,100 -$2,350