Centric Sail Makers Manufactures Sails for Sailboats

question 120

Multiple Choice

Centric Sail Makers manufactures sails for sailboats.The company has the capacity to produce 36,000 sails per year and is currently producing and selling 30,000 sails per year.The following information relates to current production:

If a special pricing order is accepted for 5,600 sails at a sales price of $150 per unit,and fixed costs remain unchanged,what is the change in operating income? (Assume the special pricing order will require variable manufacturing costs and variable selling and administrative costs. )

• A)Operating income decreases by $840,000.
• B)Operating income increases by $840,000.
• C)Operating income decreases by $392,000.
• D)Operating income increases by $392,000.

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Definitions:

Self-Referencing

Denoting a statement or situation where the subject refers to or relates directly to itself.

Self-Awareness

The conscious knowledge of one’s own character, feelings, motives, and desires.

Generalized Other

A combination of other people’s views that tells you who and what you are.

Social Role

refers to the set of behaviors, rights, obligations, and expectations associated with a particular social status or position in a group or society.