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Accounting: What the Numbers Mean 9th Edition by Wayne W McManus, Daniel F Viele, David H Marshall
Edition 9ISBN: 0073527068Accounting: What the Numbers Mean 9th Edition by Wayne W McManus, Daniel F Viele, David H Marshall
Edition 9ISBN: 0073527068 Exercise 46
Step-by-step solution
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Step 1 of 2
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a. | Relevant costs for the special sales order include the following: | ||
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| Per Gallon |
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| Raw materials | $3.20 |
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| Direct labor | 1.60 |
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| Variable overhead | 1.00 |
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| Distribution | .70 |
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| Total relevant costs per gallon | $6.50 |
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b. |
| Per Gallon |
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| Sales price | $7.70 |
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| Less: relevant costs | 6.50 |
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| Contribution margin per gallon | $ 1.20 |
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| Daily sales in gallons | 600 |
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| Daily increase in operating income | $720.00 |
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Step 2 of 2
Accounting: What the Numbers Mean 9th Edition by Wayne W McManus, Daniel F Viele, David H Marshall
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