Reference no: EM132315487

Question :

At the end of the year, a company offered to buy 4,020 units of a product from X Company for a special price of $11.00 each instead of the company's regular price of $18.00 each. The following information relates to the 60,800 units of the product that X Company made and sold to its regular customers during the year:

                                  Per-Unit         Total

Cost of goods sold         $8.26           $502,208
Period costs                  2.20             133,760
Total                           $10.46         $635,968

Fixed cost of goods sold for the year were $121,600, and ?xed period costs were $72,960. Variable period costs include selling commissions equal to 3% of revenue.

There is concern that regular customers will find out about the special order, and X Company's regular sales will fall by 550 units. As a result of these lost sales, X Company's profits would fall by?