Cornish Company had the following results of operations for the past year: A foreign company (whose sales will not affect Cornish's market)offers to buy 3,000 units at $17.00 per unit.In addition to variable manufacturing costs,selling these units would increase fixed overhead by $500 and selling and administrative costs by $1,000.If Cornish accepts the offer,its profits will:
A)Decrease by $4,500.
B)Increase by $4,500.
C)Decrease by $300.
D)Increase by $13,500.
E)Increase by $15,000.

Question

Cornish Company had the following results of operations for the past year:  A foreign company (whose sales will not affect Cornish's market)offers to buy 3,000 units at $17.00 per unit.In addition to variable manufacturing costs,selling these units would increase fixed overhead by $500 and selling and administrative costs by $1,000.If Cornish accepts the offer,its profits will:
A)Decrease by $4,500. 
B)Increase by $4,500. 
C)Decrease by $300. 
D)Increase by $13,500. 
E)Increase by $15,000.

Quizplus · Accepted Answer

The Answer of Cornish Company had the following results of operations for the past year:  A foreign company (whose sales will not affect Cornish's market)offers to buy 3,000 units at $17.00 per unit.In addition to variable manufacturing costs,selling these units would increase fixed overhead by $500 and selling and administrative costs by $1,000.If Cornish accepts the offer,its profits will:
A)Decrease by $4,500. 
B)Increase by $4,500. 
C)Decrease by $300. 
D)Increase by $13,500. 
E)Increase by $15,000.

Cornish Company Had the Following Results of Operations for the Past