Exhibit 22-1 Lumens Corporation makes ornamental lamps. The costs per lamp are the following:
The manufacturing overhead can be divided into 40% variable manufacturing overhead and 60% fixed manufacturing overhead.
Refer to Exhibit 22-1. A major department store has offered to buy 1,000 of the lamps from Lumens for $120 each. Given this information, if Lumens has sufficient idle capacity, by how much would Lumens increase its profits by selling the lamps to the store?

Question

Exhibit 22-1 Lumens Corporation makes ornamental lamps. The costs per lamp are the following:
 The manufacturing overhead can be divided into 40% variable manufacturing overhead and 60% fixed manufacturing overhead.
Refer to Exhibit 22-1. A major department store has offered to buy 1,000 of the lamps from Lumens for $120 each. Given this information, if Lumens has sufficient idle capacity, by how much would Lumens increase its profits by selling the lamps to the store?

Quizplus · Accepted Answer

The Answer of Exhibit 22-1 Lumens Corporation makes ornamental lamps. The costs per lamp are the following:
 The manufacturing overhead can be divided into 40% variable manufacturing overhead and 60% fixed manufacturing overhead.
Refer to Exhibit 22-1. A major department store has offered to buy 1,000 of the lamps from Lumens for $120 each. Given this information, if Lumens has sufficient idle capacity, by how much would Lumens increase its profits by selling the lamps to the store?

Exhibit 22-1 Lumens Corporation Makes Ornamental Lamps