What is the change in operating profits

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Reference no: EM132520700

Question - Crandle Manufacturers Inc. is approached by a potential customer to fulfill a one-time-only special order for a product similar to one offered to domestic customers. The company has excess capacity. The following per unit data apply for sales to regular customers:

Variable costs:

Direct materials $130

Direct labor 60

Manufacturing support 105

Marketing costs 95

Fixed costs:

Manufacturing support 175

Marketing costs 65

Total costs 630

Markup (50%) 315

Targeted selling price $945

What is the change in operating profits if the one-time-only special order for 1,030 units is accepted for $550 a unit by Crandle?

A) $164,800 increase in operating profits

B) $164,170 increase in operating profits

C) $164,170 decrease in operating profits

D) $164,800 decrease in operating profits

Reference no: EM132520700

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