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jerico jerico
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9 years ago
Zephram Corporation has a plant capacity of 200,000 units per month. Unit costs at capacity are:

Direct materials   $4.00
Direct labor   6.00
Variable overhead   3.00
Fixed overhead   1.00
Marketing—fixed   7.00
Marketing/distribution—variable   3.60

Current monthly sales are 190,000 units at $30.00 each. Q, Inc., has contacted Zephram Corporation about purchasing 2,000 units at $24.00 each. Current sales would not be affected by the one-time-only special order. What is Zephram's change in operating profits if the one-time-only special order is accepted?
A) $14,800 increase
B) $17,200 increase
C) $22,000 increase
D) $33,200 increase
Textbook 
Cost Accounting

Cost Accounting


Edition: 14th
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cyborgcyborg
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9 years ago
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jerico Author
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#2
9 years ago
This solved my problem perfectly, thank you for your kind input.
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#3
9 years ago
Grinning Face
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