Multiple Choice
It costs Fortune Company $12 of variable and $5 of fixed costs to produce one bathroom scale which normally sells for $35.A foreign wholesaler offers to purchase 1,000 scales at $16 each.Fortune would incur special shipping costs of $2 per scale if the order were accepted.Fortune has sufficient unused capacity to produce the 1,000 scales.If the special order is accepted, what will be the effect on net income?
A) $2,000 increase
B) $2,000 decrease
C) $3,000 decrease
D) $15,000 increase
Correct Answer:
Verified
Correct Answer:
Verified
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