SloGrowth has idle capacity. They have received a special order for 2000 units at a price of $6 per unit. Currently production and sales are budgeted for 20 000 units without considering the special order. Budget information for the year is presented below.
Cost of goods sold includes $20 000 of fixed manufacturing cost. Determine the effect on profit if the special order is accepted.

Question

SloGrowth has idle capacity. They have received a special order for 2000 units at a price of $6 per unit. Currently production and sales are budgeted for 20 000 units without considering the special order. Budget information for the year is presented below. 
Cost of goods sold includes $20 000 of fixed manufacturing cost. Determine the effect on profit if the special order is accepted.

Quizplus · Accepted Answer

The Answer of SloGrowth has idle capacity. They have received a special order for 2000 units at a price of $6 per unit. Currently production and sales are budgeted for 20 000 units without considering the special order. Budget information for the year is presented below. 
Cost of goods sold includes $20 000 of fixed manufacturing cost. Determine the effect on profit if the special order is accepted.

SloGrowth Has Idle Capacity