Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. widget inc. manufactures widgets. the company has

Widget Inc. manufactures widgets. The company has the capacity to produce 100,000 widgets per year,...

80.2K

Verified Solution

Question

Accounting

Widget Inc. manufactures widgets. The company has the capacity to produce 100,000 widgets per year, but it currently produces and sells 75,000 widgets per year. The following information relates to current production:

Sales price per unit $40
Variable costs per unit:
Manufacturing $22
Marketing and administrative $7
Total fixed costs:
Manufacturing $78,000
Marketing and administrative $20,000

If a special sales order is accepted for 5,800 widgets at a price of $40 per unit, fixed costs remain unchanged, and no variable marketing and administrative costs will be incurred for this order, how would operating income be affected? (NOTE: Assume regular sales are not affected by the special order.)

A. Increase by $232,000

B. Decrease by $104,400

C. Increase by $104,400

D. Increase by $63,800

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Biology
1.2K views

One of the genes that is commonly mutated in skin cancer is the gene that codes...

Medical Sciences
1.2K views

Inflammatory chemicals cause arterioles to ________________ and increased capillary ___________________________. The group of 20 plasma proteins that...

Civil Engineering
1.2K views

The back wall of the shed of Lab. 12a is to be supported by a reinforced...

Medical Sciences
1.2K views

Please compare why angioplasty goes through the femoral artery instead of the femoral vein like the...

Advance Math
1.2K views

Let X = {1, 2, 3, 4, 5, 6} and let ? be given by...

Geometry
1.2K views

9 Given AOLOB and OC bisects ACB Find mAB and mBC 2 points B

Algebra
1.2K views

39 Which row of Pascal s Triangle should you use to expand 2x 5y

Accounting
1.2K views

Stock DividendsKaufman Company currently has 200,000 shares of $1 par common stock outstanding....

Accounting
1.2K views

Statement of Cash Flows-Indirect Method The comparative balance sheet of Merrick Equipment Co. for December...

Accounting
1.2K views

Which of the following areas within the accounting field has as its main purpose serving...

Finance
1.2K views

Let the demand function for the product produced by a firm be P=80 - 0.2Q,...

Finance
1.2K views

Net Salvage Value Allen Air Lines must liquidate some equipment that is being replaced. The...