0-2 6 Saved Help Sav Exercise 10-2 Accept new business or not LO A1 Farrow Co. expects to sell 400,000 units of its product in the next period with the following results $6,800,0ee Sales (488,000 units) Costs and expenses Direct materials Direct labor Overhead Selling expenses Administrative expenses 808,000 1,600,08e 400,000 608,000 1,028,e00 4,428,800 Total costs and expenses Net income $1,572,000 current (2) The company has an opportunity to sell 40,000 additional units at $12 per unit. The additional sales would not affect its terials and labor costs per unit would be the same for the additional units as they are for the regular units However, the additional volume would create the following incremental costs administrative expenses would increase by $172.000 total overhead would increase by 16% and
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