Question: Bluebird Manufacturing has received a special one - time order for 1 6 , 5 0 0 bird feeders at $ 4 . 5 0

Bluebird Manufacturing has received a special one-time order for 16,500 bird feeders at $4.50 per unit. Bluebird currently produces and sells 75,000 units at $8.50 each. This level represents 80% of its capacity. Production costs for these units are $5.00 per unit, which includes $3.75 of variable costs and $2.75 of fixed costs. If the special offer is accepted, there will be no incremental fixed cost. If Bluebird accepts this additional business, the effect on income will be:

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!