What would impact profits if p and t accepts special order

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Question 1: P&T Furniture has a capacity to produce 40,000 oak shelves per year and is currently sel 36,000 shelves for $32 each. Bates Hotel has approached P&T about buying 1,200 shelvl new hotel it is building and is willing to pay $26 for each shelf. The shelves can be pack: bulk, saving P&T $1.50 per shelf compared to the normal packaging cost. Normally, the have a unit variable cost of $27. The annual fixed costs of $450,000 will be unaffected b; special order and it will not affect any of its other operations. What would be the impact profits if P&T accepts this special order?

A. Profits will decrease by $6,000.

B. Profits will increase by $31,200.

C. Pro?ts will increase by $600.

D. Pro?ts will decrease by $1,200.

Reference no: EM132552591

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