The following information relates to the Jasmine Company for the upcoming year.
The cost of goods sold includes $2,400,000 of fixed manufacturing overhead;the operating expenses include $200,000 of fixed marketing expenses.A special order offering to buy 50,000 units for $15.00 per unit has been made to Jasmine.Fortunately,there will be no additional operating expenses associated with the order;however,Jasmine is operating at full capacity.How much will operating profits increase if Jasmine accepts the special order?
A) $50,000.
B) $125,000.
C) $200,000.
D) Operating profits will not increase as a result of accepting the special order.
Correct Answer:
Verified
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