80.2K

Verified Solution

Link Copied!

Suppose the Baseball Hall of Fame in Cooperstown, New York, has approached Active - Cardz with a special order. The Hall of Fame wants to purchase 56,000 baseball card packs for a special promotional campaign and offers $0.33 per pack, a total of $18,480. Active-Cardz's total production cost is $0.53 per pack, as follows: Iili (Click the icon to view the cost information.) Active-Cardz has enough excess capacity to handle the special order. Read the requirements. Requirement 1. Prepare an incremental analysis to determine whether Active-Cardz should accept the special sales order assuming fixed costs would not be affected by the special order. (Enter a " 0 " for any zero balances. Use parentheses or a minus sign to indicate a decrease in operating income from the special order.) Data table Variable costs: Direct materials Direct labor Variable overhead Fixed overhead. Total cost. 1. Prepare an incremental analysis to determine whether Active-Cardz should accept the special sales order assuming fixed costs would not be affected by the special order. 2. Now assume that the Hall of Fame wants special hologram baseball cards. Active - Cardz must spend $4,700 to develop this hologram, which will be useless after the special order is completed. Should Active - Cardz accept the special order under these circumstances? Show your analysis. Requirement 1. Prepare an incremental analysis to determine whether Active-Cardz should accept the special sales order assuming fixed costs would not be affected by the special order. (Enter a " 0 " for any zero balances. Use parentheses or a minus sign to indicate a decrease in operating income from the special order.)

Answer & Explanation Solved by verified expert

See Answer