The Following Information Relates to the Klear Company for the Upcoming

question 34

Essay

The following information relates to the Klear Company for the upcoming year, based on 300,000 units:
$\begin{array}{lrr}&\text {Amount}&\text {Per Unit}\\ \text { Sales } & \$ 9,000,000 & \$ 30.00 \\\text { Cost of goods sold } & 7,200,000 & 24.00 \\\text { Gross margin } & 1,800,000 & 6.00 \\\text { Operating expenses } & 675,000 & 2.25\\\text { Operating profits }&\$1,125,000&\$3.75\end{array}$

The cost of goods sold includes $3,000,000 of fixed manufacturing overhead; the operating expenses include $450,000 of fixed marketing expenses. A special order offering to buy 50,000 units for $25.00 per unit has been made to Klear. Fortunately, there will be no additional operating expenses associated with the order and Klear has sufficient capacity to handle the order.
Required:
a. How much will operating profits increase if Klear accepts the special order?
b. Assume that Klear is operating at full capacity. How much will operating profits change if Klear accepts the special order?

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Definitions:

Parental Responsiveness

The degree to which parents are sensitive and responsive to their children's needs, emotions, and signals.

Parental Income

Refers to the total earnings obtained by a child's parents or guardians, which can impact the child's access to resources and opportunities.

Amount

A quantity of something, typically measured in numerical terms, indicating how much is present or required.

Neighborhood Context

The social, economic, and physical conditions of an area in which people live and interact.