Thomas Valve Company has the capacity to produce 100,000 valves per year. Last year the company...

 

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Thomas Valve Company has the capacity to produce 100,000 valves per year. Last year the company had the following operating results: Sales (90.000 units at $6,750,000 $75) Variable costs 2.700.000 Contribution Margin 4,050,000 Fixed costs 2.000.000 Net Operating Income $2.050.000 The company normally sells to individual suppliers that order in small quantities, and expects sales to regular customers to remain the same for this year. Thomas has received a special order from a large contractor that wants to purchase 12.000 valves at a reduced price of S60 per valv If the company accepts the special order and rejects some sales to its regular customers, what would be the net operating income for the current year? O $2.410.000 52.770.000 O$1,960,000 $2.320.000 Thomas Valve Company has the capacity to produce 100,000 valves per year. Last year the company had the following operating results: Sales (90.000 units at $6,750,000 $75) Variable costs 2.700.000 Contribution Margin 4,050,000 Fixed costs 2.000.000 Net Operating Income $2.050.000 The company normally sells to individual suppliers that order in small quantities, and expects sales to regular customers to remain the same for this year. Thomas has received a special order from a large contractor that wants to purchase 12.000 valves at a reduced price of S60 per valv If the company accepts the special order and rejects some sales to its regular customers, what would be the net operating income for the current year? O $2.410.000 52.770.000 O$1,960,000 $2.320.000

Answer rating: 100% (QA)

Regular sales lost 2000 1200010000090000 Variable unit cost 30 270000090000 Incremental rev... View the full answer