A Company Contemplating the Acceptance of a Special Order Has

question 123

Multiple Choice

A company contemplating the acceptance of a special order has the following unit cost behavior, based on 10,000 units: $$\begin{array} { l r } \text { Direct materials } & \$ 4 \\\text { Direct labor } & 10 \\\text { Variable overhead } & 8 \\\text { Fixed overhead } & 6\end{array}$$ A foreign company wants to purchase 2,000 units at a special unit price of $25.The normal price per unit is $40.In addition, a special stamping machine will have to be purchased for $4,000 in order to stamp the foreign company's name on the product.The incremental income (loss) from accepting the order is

• A)$6,000.
• B)$2,000.
• C)$(6,000).
• D)$(2,000).

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Definitions:

Mutualism

A type of ecological interaction where both participating species benefit from the relationship.

Commensalism

A relationship between two organisms where one benefits and the other is neither harmed nor benefited significantly.

Parasitism

A symbiotic relationship in which one organism (the parasite) benefits at the expense of another organism (the host), often causing harm.

Top-down Processes

Refers to cognitive processes that are guided by higher-level mental processes, such as prior knowledge, expectations, and attention, influencing the perception and interpretation of information.