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Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expenses Totals Revenues...

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Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expenses Totals Revenues Variable costs Direct materials Direct labor Per Undergarment Variable overhead 2 08 Tocal variable costs The U S Army has approached Klean Fiber and expressed an interest in purchasing 250 900 Y Go undergarments for soldiers in extremely warm climates The Army would pay the unit cost for direct materials direct labor and variable manufacturing overhead costs In addition the Army has agreed to pay an additional 0 95 per undergarment to cover all other costs and provide a profit Presently Klean Fiber is operating at 70 capacity and does not have any other potential buyers for Y Go If Klean Fiber accepts the Army s offer it will not incur any variable selling expenses related to this order 0 44 0 99 Prepare an incremental analysis for the Klean Fiber Enter negative amounts using either a negative sign preceding the number eg 45 or parentheses eg 45 1 44 0 39 5 34 Reject Order 6 0 0 Total 2 275 520 481 360 1 083 060 1 575 360 426 660 5 841 960 50 E Accept Order 1134365 508515 120240 280500 79253 Net Income Increase Decrease 113465 508515 120240 230300 379255

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