Question: Busy Co. can make 200 widgets per month and cannot make more than 250. The following is the cost per widget information related to manufacturing:
Busy Co. can make 200 widgets per month and cannot make more than 250. The following is the cost per widget information related to manufacturing: Direct Materials $15 Direct Labor 10 Variable Manufacturing Overhead 2 Fixed Manufacturing Overhead 12 *The Fixed Manufacturing Overhead cost per unit is calculated based on a volume of 200 widgets. Busy Co. always sells all 200 widgets it produces for $55 per widget. Busy Co. receives a special order for 100 widgets but the order asks for a price of $50 dollars a widget. The order cannot be partially filled. Outside of this order, there is still a demand for 200 widgets. If Busy Co. accepts this order, how will their net income be affected? O c. Net income will decrease by $300. d. Net income will increase by $2,300. b. Net income will increase by $900. O a.Net income will increase by $1,100
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