Question: Luse Enterprises is considering a special order for an export company. Luses normal selling price is $15 per unit, and the price for the special
Luse Enterprises is considering a special order for an export company. Luses normal selling price is $15 per unit, and the price for the special order is $10 per unit for 10,000 units. Luses variable cost is normally $8 per unit but $1 per unit in selling expense that is normally incurred will be avoided on the special order. Luse has capacity to produce 100,000 units and is currently selling 90,000. Total fixed costs of $30,000 per year will be unaffected. What will be the impact of the accepting the special order on Luses income?
| income will increase by $30,000 |
| income will increase by $70,000 |
| income will increase by $23,000 |
| income will increase by $15,000 |
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