Lattimer Company Had the Following Results of Operations for the Past

question 35

Multiple Choice

Lattimer Company had the following results of operations for the past year: A foreign company offers to buy 5,000 units at $7.50 per unit. In addition to existing costs, selling these units would add a $0.25 selling cost for export fees. Lattimer's annual production capacity is 25,000 units. If Lattimer accepts this additional business, the special order will yield a:

• A) $2,000 loss.
• B) $8,250 loss.
• C) $3,750 profit.
• D) $3,250 loss.
• E) $5,000 profit.

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Definitions:

Delegatee

One to whom contract duties are delegated by another, called the delegator.

Delegated Duty

A task or responsibility that is assigned by someone in authority to another person or entity to execute.

Assignor

The person who assigns contract rights.

Obligor

The party in a contractual agreement who is bound to provide a payment or performance to the other party, known as the obligee.