Solution-What will profit if the order is accepted

What will profit if the order is accepted

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Reference no: EM132501275

Sycamore Shops has a capacity of 50,000 units and is currently producing and selling 45,000 at $50 a unit. The present cost structure, on a per unit basis, is:

Direct material $20

Direct labour 10

Variable overhead 6

Fixed overhead 8

Question 1: An order for 7,000 units has been received from a Japanese company at a price of $45 per unit. The order size cannot be reduced. If the order is accepted, profit will:

A. Not change

B. Increase by $35,000

C. Decrease by $35,000

D. Increase by $63,000

Reference no: EM132501275

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What will profit if the order is accepted

Reference no: EM132501275

Reference no: EM132501275

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