What would be the impact on monthly profits

Reference no: EM13127297

The Crimson Tide Company produces T-shirts promoting the University of Alabama to various retailers. The costs of producing and selling a single T-shirt at the company's current activity level of 10,000 units per month are:

Direct Materials $3.00
Direct Labor 2.50
Variable Manufacturing Overhead 1.00
Fixed Manufacturing Overhead 4.00
Variable Selling and Administrative Expenses 2.00
Fixed Selling and Administrative Expenses 1.00

The normal selling price is $18 per unit. The company's capacity is 12,000 units per month. Due to the University of Alabama participating in the BCS National Championship Game, an order has been received from a retailer for 2,000 additional T-shirts at $14 per unit. This order would not affect regular sales and would not change the company's total fixed costs.

Ignore the impact of income taxes in your calculation.

Should the order be accepted? What would be the impact on monthly profits?

Reference no: EM13127297

Questions Cloud

Determining complex inner product space proof : Suppose V is a complex inner product space and T: V --> V a linear operator. Use the results from parts (a) and (b) to show V = im(T) + ker (T*) = im(T*) + ker(T).

Find the probability that four or more are introverts : In a group of 6 computer programmers, what is the probability that none are introverts? What is the probability that 4 or more are introverts?

Current-year pension expense : The company has an unrecognized gain of $60,000. To what extent will the unrecognized gain reduce current-year pension expense?

How much ammonia is needed : 2 NH3 + CH3OH → products . How much NH3 is needed to react exactly with 21 grams of CH3OH

What would be the impact on monthly profits : The normal selling price is $18 per unit. The company's capacity is 12,000 units per month. Due to the University of Alabama participating in the BCS National Championship Game, an order has been received from a retailer for 2,000 additional T-shi..

Question regarding factor analysis : Determine the appropriate importance weights of F1 , F2 , F3 , F4 to be used in the multifactor evaluation process. (Hint: Consider numerator factors of 4.)

Find what is the vibrational contribution to cv : what is qvib at a temperature of 3100 K, keeping the zero point energy and referenced to v= 0? What is the vibrational contribution to CV, at the temperature 2600 K?

Calculate the root-mean-square speed of neon atoms : Two vessels are labeled A and B. Vessel A contains NH3 gas at 73 degrees C and vessel B contains Ne gas at the same temperature. If the average kinetic energy of NH3 is 7.1 10-21 J/molecule at 70 degrees C.

Amount of the return on plan : During the year 3, Gruber paid out $20,000 in benefits and continued to contribute $70,000 to the plan. The plan assets had a fair market value of $377,000. What was the amount of the return on plan assets in year 3?

User Account

All Pages