MEX Company manufactures a product with a cost of $52 per unit ($30 variable and $22 fixed). This product normally sells to customers for $60 per unit. Ixtapa Industries, a foreign company, offers to purchase 5,000 units at $42 each. MEX Company would incur $4 of special packaging and shipping costs if the order is accepted. MEX Company has sufficient unused capacity to produce the 5,000 special-order units. If the special order is accepted, what will the effect be on MEX Company's income?

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The Answer of MEX Company manufactures a product with a cost of $52 per unit ($30 variable and $22 fixed). This product normally sells to customers for $60 per unit. Ixtapa Industries, a foreign company, offers to purchase 5,000 units at $42 each. MEX Company would incur $4 of special packaging and shipping costs if the order is accepted. MEX Company has sufficient unused capacity to produce the 5,000 special-order units. If the special order is accepted, what will the effect be on MEX Company's income?

MEX Company Manufactures a Product with a Cost of $52