Question: Question Content Area Marcotti Cupcakes bakes and sells a basic cupcake for $1.25. The cost of producing 600,000 cupcakes in the prior year was: Revenues

Question Content Area

Marcotti Cupcakes bakes and sells a basic cupcake for $1.25. The cost of producing 600,000 cupcakes in the prior year was:

Revenues	$750,000
Direct materials	324,000
Direct labor	60,000
Manufacturing overhead (fixed)	132,000
Manufacturing overhead (variable)	84,000

At the start of the current year, Marcotti received a special order for 14,000 cupcakes to be sold for $1.10 per cupcake. To complete the order, the company must incur an additional $800 in total fixed costs to lease a special machine that will stamp the cupcakes with the customers logo. This order will not affect any of Marcottis other operations and it has excess capacity to fulfill the contract. Should the company accept the special order?

YesNo

, profit will

increasedecrease

by $fill in the blank 3

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