At the end of the year, a company offered to buy 4,210 units of a...
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At the end of the year, a company offered to buy 4,210 units of a product from X Company for $11.00 each instead of the company's regular price of $17.00 each. The following income statement is for the 60,300 units of the product that X Company has already made and sold to its regular customers: Sales Cost of goods sold Gross margin Selling and administrative costs Profit $1,025,100 562,599 $462,501 158,589 $303,912 For the year, variable cost of goods sold were $449,838, and variable selling and administrative costs were $75,375. The special order product has some unique features that will require additional material costs of $0.77 per unit and the rental of special equipment for $2,500. 4. Profit on the special order would be Submit Answer Tries 0/3 5. The marketing manager thinks that if X Company accepts the special order, regular customers will be lost unless the selling price for them is reduced by $0.15. The effect of reducing the selling price will be to decrease firm profits by Submit Answer Tries 0/3
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