Wildhorse Company produces golf discs which it normally seils to retailers for $6 each. The...
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Wildhorse Company produces golf discs which it normally seils to retailers for $6 each. The cost of manufacturing 25,000 golf discs is: Wildhorse also incurs 5% sales commission ($0.30) on each dise sold. Rudd Corporation offers Wildhorse $4,40 per disc for 3,600 dises, Rudd would setl the dises under its awn brand name in foreign markets not served by Wildhorse. If Wildhorse accepts the offer. its fixed overhead wili increase from $48,800 to $52400 due to the purchase of a newimprinting machine, No sales commission will result from the special order. Reject Order Accept Order Net Income Effect Materials $12250 \( 5 \longdiv { 1 4 0 1 4 } \) 5 1764 Labor 36500 I 41756 Variable Overhead 24500 28028 03528 0 0 SalesCommissions 7500 7500 Fioced Overhead 48800 52400 3600 Revenues 129550 Net income / (Loss) 20450 22142
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