Lansing Manufacturers produces can openers. For the first six months of 2014, the company reported...
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Accounting
Lansing Manufacturers produces can openers. For the first six months of 2014, the company reported the following operating results for 16,000 units, while operating at 80% of plant capacity.
Sales
$2,000,000
Cost of goods sold
1,200,000
Gross profit
800,000
Operating expenses
420,000
Net income
$ 380,000
Cost of goods sold was 75% variable and 25% fixed. Operating expenses were 60% variable and 40% fixed. In July of 2014, Lansing receives a special order for 3,000 can openers at $85.75 each from a foreign company. The can openers normally sell for $112.00. Acceptance of the special order would result in $1,000 of shipping costs but no increase in fixed operating expenses.
Instructions
Calculate the net income from special order
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