Use the Following Information for the Next 3 Questions

question 124

Multiple Choice

Use the following information for the next 3 questions.
Taylor Enterprises sells its product for $40 per unit. Taylor recently received a special order from a customer for 20,000 units. Production costs per unit for regular sales are:
-Suppose the special order price is $600,000 for all 20,000 units, and assume that Taylor has sufficient capacity to fill the special order. Should it be accepted?

• A) Yes, because profits will increase by $120,000
• B) No, because profits will decrease by $200,000
• C) No, because profits will decrease by $40,000
• D) Yes, because profits will increase by $40,000

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Definitions:

Cash Short and Over

An account that records discrepancies between actual cash received and the expected amount, often due to errors or theft.

Cash Shortages

Instances when the actual cash available is less than the amount expected or needed.

Cash Overages

Excess of actual cash received over the expected amount, often caused by either errors in transactions or more sales than recorded.

Cash Discounts

Incentives offered by sellers to encourage buyers to pay their bills quickly, usually expressed as a percentage of the invoice amount if paid within a specific period.