Moonbeam Company manufactures toasters. For the first 8 months of 2017, the comp

Question

Moonbeam Company manufactures toasters. For the first 8 months of 2017, the company reported the following operating results while operating at 75% of plant capacity: Sales (351,000 units) Cost of goods sold Gross profit Operating expenses Net income $4,375,000 2,607,000 1,768,000 840,100 $927,900 Cost of goods sold was 74% variable and 26% fixed; operating expenses were 84% variable and 16% fixed. In Septamber, Moonbeam Company recelves a special order for 17,900 toasters at $8.12 each from Luna Company of Cludad Juarez. Acceptance of the order would result in an additional $3,000 of shipping costs but no increase in fixed costs. Prepare an incremental analysis for the special order. (Round computations for per unit cost to 4 decimal places, e.g. 15.2500 and all other computations and final answers to the nearest whole dollar, e.g. 5,725. Enter negative amounts using either a negative sign preceding the number e.g.-45 or parentheses e.g. (45).) Net Income Roject Order Accept Order (Decrease) Cost of goods sold Operating expenses Net income Should Moonbeam Company accept the special order? Moonbeam Company ? the special order.

Explanation / Answer

Reject order Accept order Net income increase(decrease) Revenues 0 145348 145348 Cost of goods sold 0 -98382 -98382 Operating expenses 0 -38988 -38988 Net income 0 7978 7978 b Moon beam company should accept the order

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