What is the change in operating profits if the one-time-only special order for 1,000 units is accepted for $360 a unit by Kolar?
A)$140,000 increase in operating profits
B)$20,000 increase in operating profits
C)$20,000 decrease in operating profits
D)$150,000 decrease in operating profits

Question

Quizplus · Accepted Answer

The special order generates additional revenue of $360,000 (1,000 units x $360). If the variable costs per unit are less than $360, the order will increase operating profits. Assuming variable costs are less than $220 per unit, the profit increase would be $140,000.

What Is the Change in Operating Profits If the One-Time-Only