Snow Sports Company received a special order for 1,000 units of its extreme snowboards at a selling price of $40 per snowboard. Snow Sports has enough capacity to accept the order. Unit costs to make and sell this product are as follows: Direct Materials $12; Direct labour $19; Variable Manufacturing Overhead $6; Fixed Manufacturing Overhead $12; and Variable Selling Costs $5.
What will be Snow Sports Company's change in operating income if they accept the special order? Should Snow Sports Company accept the order? Explain why or why not.

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The Answer of Snow Sports Company received a special order for 1,000 units of its extreme snowboards at a selling price of $40 per snowboard. Snow Sports has enough capacity to accept the order. Unit costs to make and sell this product are as follows: Direct Materials $12; Direct labour $19; Variable Manufacturing Overhead $6; Fixed Manufacturing Overhead $12; and Variable Selling Costs $5.
What will be Snow Sports Company's change in operating income if they accept the special order? Should Snow Sports Company accept the order? Explain why or why not.

Snow Sports Company Received a Special Order for 1,000 Units