A foreign wholesaler wants to buy 1,500 units for $40 per unit. All fixed costs...
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A foreign wholesaler wants to buy 1,500 units for $40 per unit. All fixed costs would remain within the relevant range (up to capacity). There would be no variable selling costs on the special order units. Deacons Corporation can produce 12,000 units per year. Required: a. Redo the income statement assuming that the special order of 1,500 units was accepted. b. Should Deacon Company produce a special order? Justify your answer. If Deacon Company accepts the special order, they must produce and sell the entire 1,500 units for $40 per unit. b. Should Deacon Company produce a special order for 3,000 units for $40 per unit? Justify your answer by redoing the income statement assuming the special order. If Deacon Company accepts the special order, they must produce and sell the entire 3,000 units for $40. In other words, they may lose regular customers
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A foreign wholesaler wants to buy 1,500 units for $40 per unit. All fixed costs would remain within the relevant range (up to capacity). There would be no variable selling costs on the special order units. Deacons Corporation can produce 12,000 units per year. Required: a. Redo the income statement assuming that the special order of 1,500 units was accepted. b. Should Deacon Company produce a special order? Justify your answer. If Deacon Company accepts the special order, they must produce and sell the entire 1,500 units for $40 per unit. b. Should Deacon Company produce a special order for 3,000 units for $40 per unit? Justify your answer by redoing the income statement assuming the special order. If Deacon Company accepts the special order, they must produce and sell the entire 3,000 units for $40. In other words, they may lose regular customers 