Brilliant, Inc. reported the following results from the sale of 31,000 units of IT-54:

Sales	$	546,000
Variable manufacturing costs		310,000
Fixed manufacturing costs		124,000
Variable selling costs		54,800
Fixed administrative costs		36,400

  
Extra Company has offered to purchase 3,700 IT-54s at $13 each. Brilliant has available capacity, and the president is in favor of accepting the order. She feels it would be profitable because no variable selling costs will be incurred. The plant manager is opposed because the "full cost" of production is $14. Which of the following correctly notes the change in income if the special order is accepted?

Answer rating: 100% (QA)

To determine the change in income if the special order is accepted we need to compare the income wit... View the full answer