The Bharu Violin Corporation has the capacity to manufacture and sell 5,000 violins each year but is currently only manufacturing and selling 4,800. The following data relate to annual operations at 4,800 units: Per ViolinSelling price$600 Manufacturing costs: Variable$130 Fixed$270 Selling and administrative costs: Variable$20 Fixed$40 Woolgar Symphony Orchestra is interested in purchasing Bharu's excess capacity of 200 units but only if they can get the violins for $350 each. This special order would not affect regular sales or the total fixed costs.Assume that Bharu is manufacturing and selling at capacity (5,000 units). Any special order will mean a loss of regular sales. Under these conditions if the special order from Woolgar Symphony Orchestra is accepted, the
financial advantage (disadvantage) Bharu for the year should be:
A. ($28,000)
B. ($50,000)
C. $20,000
D. ($22,000)
Answer: B
You might also like to view...
Cost of goods sold is an expense, and is reported on the income statement.
Answer the following statement true (T) or false (F)
Virtual interviewing is an excellent method for screening out candidates who are unable to communicate their competence, enthusiasm, and conviction in a technology-rich environment
Indicate whether the statement is true or false
Which type of workplace is likely to utilize open management employee meetings and open e-mail communications to learn of its employees’ concerns and expectations?
a. information-based workplace b. open communication-based workplace c. inclusive workplace d. exclusionary workplace
Tony and Barb went ____ talk with their supervisor about their proposal to job share
A) in to B) into