Braizen, Inc.produces a product with a $30 per-unit variable cost and an $80 per-unit sales price.Fixed manufacturing overhead costs are $100,000.The firm has a one-time opportunity to sell an additional 1,000 units at $60 each that would not affect its current sales.Assuming the company has sufficient capacity to produce the additional units, how would the acceptance of the special order affect net income?
A)Income would decrease by $30,000.
B)Income would increase by $30,000.
C)Income would increase by $140,000.
D)Income would increase by $40,000.

Question

Quizplus · Accepted Answer

The special order price is $60, and the variable cost is $30, resulting in a contribution margin of $30 per unit. For 1,000 units, the increase in income would be 1,000 units * $30 = $30,000.