The Shoop Corporation produces and sells a part used in the production of tractors. The unit costs associated with this part are as follows:

Jupiter Company has approached Shoop Corporation with an offer to purchase 20,000 units of this part at a price of $.72. Accepting this special sales order will put idle manufacturing capacity to use and will not affect regular sales. Total fixed costs will not change.
Determine whether or not the special order should be accepted. Justify your conclusion.

Question

The Shoop Corporation produces and sells a part used in the production of tractors. The unit costs associated with this part are as follows:
  
Jupiter Company has approached Shoop Corporation with an offer to purchase 20,000 units of this part at a price of $.72. Accepting this special sales order will put idle manufacturing capacity to use and will not affect regular sales. Total fixed costs will not change.
Determine whether or not the special order should be accepted. Justify your conclusion.

Quizplus · Accepted Answer

The Answer of The Shoop Corporation produces and sells a part used in the production of tractors. The unit costs associated with this part are as follows:
  
Jupiter Company has approached Shoop Corporation with an offer to purchase 20,000 units of this part at a price of $.72. Accepting this special sales order will put idle manufacturing capacity to use and will not affect regular sales. Total fixed costs will not change.
Determine whether or not the special order should be accepted. Justify your conclusion.

The Shoop Corporation Produces and Sells a Part Used in the Production