A Company Contemplating the Acceptance of a Special Order Has

question 55

Multiple Choice

A company contemplating the acceptance of a special order has the following unit cost behavior based on 10000 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 2000 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 $4000 in order to stamp the foreign company's name on the product.The incremental income (loss) from accepting the order is

• A)$6000.
• B)$2000.
• C)$(6000).
• D)$(2000).

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Definitions:

Securely Attached

A form of attachment where children show a strong and positive bond with their caregivers, feeling secure to explore their environment.

Majority

The greater part or number in a group, or more than half of the total.

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A country in North America consisting of 50 states and is a federal republic.

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A colloquial term describing a developmental phase in toddlers characterized by mood swings, temper tantrums, and assertive behavior.