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At the end of the year, a company offered to buy 4,950 units of a...

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Accounting

At the end of the year, a company offered to buy 4,950 units of a product from X Company for a special price of $12.00 each instead of the company's regular price of $17.00 each. The following information relates to the 62,300 units of the product that X Company made and sold to its regular customers during the year:

Per-Unit Total
Cost of goods sold $8.38 $522,074
Period costs 2.54 158,242
Total $10.92 $680,316

Fixed cost of goods sold for the year were $114,009, and fixed period costs were $90,335. Variable period costs include selling commissions equal to 3% of revenue

Assume the following two changes for the special order: 1) variable cost of goods sold will increase by $0.73 per unit, and 2) there will be no selling commissions. What will be the effect of these two changes on the special order profit?

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