Variable costs were 60% of cost of goods sold and 30% of operating expenses. A foreign company
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Variable costs were 60% of cost of goods sold and 30% of operating expenses. A foreign company wants to purchase 1,500 units at a special unit price of $20. Acceptance of the order will result in an additional $1,500 shipping costs, but no increase in other fixed costs.
What is the total cost of accepting the special order? *
$27,000
$30,375
$31,875
None of the above
By what amount would the company's operating income be increased or decreased as a result of accepting the special order? *
$1,875 decrease
$1,875 increase
$30,000 increase
None of the above
?
Related Book For
Fundamentals of Corporate Finance
ISBN: 978-1118845899
3rd edition
Authors: Robert Parrino, David S. Kidwell, Thomas W. Bates
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