During the year, X Company sold 62,800 units of one of its products for $19.00...
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Accounting
During the year, X Company sold 62,800 units of one of its products for $19.00 each. The following cost functions are for these regular production and sales levels:
Cost of goods sold: $6.16X + $138,160
Selling and administrative expenses: $2.64X + $65,312
Variable selling and administrative expenses include sales commissions equal to 3% of sales. At the end of the year, a company offered to buy 4,140 units but was only willing to pay $12.00 each. X Company had the capacity to produce the 4,140 units.
If X Company had accepted the special order, firm profits would have increased by
Now assume that there would not have been sales commissions for the special order. If X Company had accepted the special order, firm profits would have increased by
