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Paragon Products sells a special kind of navigation equipment for $1300.Variable costs are $900 per unit.When a special order arrived from a foreign contractor to buy 42 units at a reduced price of $1000 per unit,there was a discussion among management.The management accountant said that as long as the special price was greater than the variable costs,the sale would contribute to the company's profits,and so it should be accepted as offered.The vice-president,however,decided to decline the order.Which of the following statements,if true,will support the decision of the vice-president?
Budgeted Sales
The projected amount of sales, in units or dollars, that a company plans to achieve in a specific period.
Production Budget
A forecast of the quantity of products that must be manufactured in a specified time period to meet customer demand and maintain inventory levels.
Ending Inventory
The total value of goods available for sale at the end of an accounting period, calculated as beginning inventory plus purchases minus cost of goods sold.
Budgeted Sales
Predicted sales revenue for a future period, based on historical data, market analysis, and other forecasting methods.
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