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How much will stone income change if the company accepts

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Question: Stone Manufacturing has an annual capacity of 85,000 units per year. Currently, the company is making and selling 78,000 units a year. The normal sales price is $120 per unit, variable costs are $90 per unit, and total fixed expenses are $2,000,000. An out-of-state distributor has offered to buy 12,000 units at $105 per unit. Stone's cost structure should not change as a result of this special order.

Required:

(a) By how much will Stone's income change if the company accepts this order?

 

Reference no: EM133534163

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