The Parton Company Has Gathered the Following Information for a Unit

question 123

Essay

The Parton Company has gathered the following information for a unit of its most popular product:
$$\begin{array} { | l | r | } \hline \text { Direct materials } & \$ 20 \\\hline \text { Direct labor } & 15 \\\hline \text { Overhead (60\% variable) } & 20 \\\hline \text { Cost to manufacture } & \$ 55 \\\hline\end{array}$$

The above cost information is based on 10,000 units.Parton currently sells 8,500 units for $62 per unit.A distributor has offered to buy 1,000 units at a price of $50 per unit.This special order would not disturb regular sales.Required:
a.Calculate Parton's change in operating profits if the special order is accepted.b.How many units of regular sales could be lost before this contract is not profitable?

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Definitions:

Proximal-distal

A pattern of development or movement that starts from the center or core of the body and moves outwards to the extremities.

Preschooler

A child typically between the ages of 3 and 5 years old, who is in the developmental stage prior to entering kindergarten.

Bodily Harm

Physical injury, damage, or harm inflicted on a person's body by an external force or substance.

Weight Gain

The increase in body weight over a period of time, which can result from various factors including an excess of caloric intake over expenditure.