Maria's Food Service provides meals that nonprofit organizations distribute to handicapped and elderly people. The following...

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Maria's Food Service provides meals that nonprofit organizations distribute to handicapped and elderly people. The following is her forecasted income statement for April, when she expects to produce and sell 3,700 meals: Amount Per Unit $ 24,790 Sales revenue Costs of meals produced Gross profit $6.70 4.85 17,945 $6,845 $1.85 Administrative costs 2,980 0.80 Operating profit $ 3,885 $1.05 Fixed costs included in this income statement are $5,809 for meal production and $740 for administrative costs. Ma special request from an organization sponsoring a picnic to raise funds for the Special Olympics. Thisloganization is willing to pay $3.85 per meal for 300 meals on April 10. Maria has sufficient idle capacity to fill this special order. These meals will incur all of the variable costs of meals produced, but variable administrative costs and total fixed costs will not be affected. Required: a. What impact would accepting this special order he on operating profit? (Select option "higher" or "lower", keeping Status Quo as the base. Select "none" if there is no effect.) Status Quo 3,700 Units Alternative 4,000 Units Difference Sales revenue S 24,790 $ 25,945 Variable costs Meals 12,136 13,032 2,220 Administrative 2,220 Contribution margin 10,434 10,693 $ Fixed costs 6,549 6,549 3,885 4,144 $ Operating profit $ S $ $ 1,155 higher 896 higher 0 none 259 x higher 0 none higher 259 >x > 10000 Maria's Food Service provides meals that nonprofit organizations distribute to handicapped and elderly people. The following is her forecasted income statement for April, when she expects to produce and sell 3,700 meals: Amount Per Unit $ 24,790 Sales revenue Costs of meals produced Gross profit $6.70 4.85 17,945 $6,845 $1.85 Administrative costs 2,980 0.80 Operating profit $ 3,885 $1.05 Fixed costs included in this income statement are $5,809 for meal production and $740 for administrative costs. Ma special request from an organization sponsoring a picnic to raise funds for the Special Olympics. Thisloganization is willing to pay $3.85 per meal for 300 meals on April 10. Maria has sufficient idle capacity to fill this special order. These meals will incur all of the variable costs of meals produced, but variable administrative costs and total fixed costs will not be affected. Required: a. What impact would accepting this special order he on operating profit? (Select option "higher" or "lower", keeping Status Quo as the base. Select "none" if there is no effect.) Status Quo 3,700 Units Alternative 4,000 Units Difference Sales revenue S 24,790 $ 25,945 Variable costs Meals 12,136 13,032 2,220 Administrative 2,220 Contribution margin 10,434 10,693 $ Fixed costs 6,549 6,549 3,885 4,144 $ Operating profit $ S $ $ 1,155 higher 896 higher 0 none 259 x higher 0 none higher 259 >x > 10000

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all amounts in Working Note 1 Calculation of Varaible Cost and Fixed Cost of meals Cost of meals 485 ... View the full answer