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During the year, X Company produced and sold 60,800 units of one of...

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Accounting

During the year, X Company produced and sold 60,800 units of one of its products. The following is the related revenue and cost information:

Revenue $1,155,200
Cost of goods sold 486,400
Selling and administrative costs 276,640
Profit $392,160

Total variable cost of goods sold were $369,056, and total variable selling and administrative costs were $198,208.

At the end of the year, a company offered to buy 4,270 units but was only willing to pay $11.00 each.

4. If X Company had accepted the special order, firm profits would have increased by

A: $7,131 B: $8,914 C: $11,142 D: $13,928 E: $17,409 F: $21,762
Tries 0/99

5. There is concern that regular customers will find out about the special order, and in order to retain all of the X Company's regular customers, the regular selling price would have to be reduced by $0.54. If the selling price were reduced and next year's unit sales turn out to be the same as this year's sales, firm profits would fall by

A: $7,889 B: $10,493 C: $13,955 D: $18,561 E: $24,686 F: $32,832

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