Cornish Company Had the Following Results of Operations for the Past

question 41

Multiple Choice

Cornish Company had the following results of operations for the past year: A foreign company offers to buy 3,000 units at $17.00 per unit. In addition to variable manufacturing costs, selling these units would increase fixed overhead by $500 and selling and administrative costs by $1,000. If Cornish accepts the offer, its profits will:

• A) Decrease by $4,500.
• B) Increase by $4,500.
• C) Decrease by $300.
• D) Increase by $13,500.
• E) Increase by $15,000.

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