Multiple Choice
Use the following to answer questions
Naui Industries produces flowered shirts which normally sell for $24 each. The total cost to manufacture each shirt is $17, which consists of $11 of variable costs and $6 of fixed costs. A hotel chain has approached Naui with a special order for 2,000 shirts at $15 each.
-Assuming Naui has sufficient excess capacity to fill this special order without affecting sales to current customers,it should:
A) reject the offer since income will decrease by $8,000
B) accept the offer since income will increase by $8,000
C) reject the offer since income will decrease by $4,000
D) accept the offer since income will increase by $4,000
Correct Answer:

Verified
Correct Answer:
Verified
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