Question: tra Practice Special Order Decision Unit Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expense Fixed selling expense Apple Corporation manufactures

 tra Practice Special Order Decision Unit Direct materials Direct labor Variable

tra Practice Special Order Decision Unit Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expense Fixed selling expense Apple Corporation manufactures and sells the l-Pod Nano. Here are the unit costs: A large charitable organization has offered to purchase 5,000 Shuffles this month to give away to children, but only if Apple Corporation is willing to accept a 40% discount off the regular price of $50 There would be no sales commissions on this order; thus, variable selling expenses would be slashe by 70%. However, Apple Corporation would have to purchase a special machine to engrave the charitable organization's name on the 5,000 units. This machine would cost $12,000. This would be one-time order that would have no effect on regular sales. How much would Apple make or lose) this offer? $12.00 10.00 2.00 4.00 6.00 4.00 Total cost $38.00 Per Unit 5,000 Units Special Price Incremental Variable Costs Direct Materials Direct Labor $12.00 Variable Overhead 2.00 $6.00 30.00 Variable Selling Total Variable Costs Contribution Margin Fixed Overhead/Fixed Selling Incremental Fixed cost Increase (decrease) in operating income What's your decision? What's the minimum selling price you would accept

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