Jacoby Company received an offer from an exporter for 30,000 units of product at $15 per unit. The acceptance of the offer will not affect normal production or domestic sales prices. The following data are available:Domestic unit sales price$21Unit manufacturing costs:Variable12Fixed5What is the differential revenue from the acceptance of the offer?
A) $450,000
B) $630,000
C) $510,000
D) $120,000

Question

Jacoby Company received an offer from an exporter for 30,000 units of product at $15 per unit. The acceptance of the offer will not affect normal production or domestic sales prices. The following data are available:Domestic unit sales price$21Unit manufacturing costs:Variable12Fixed5​​What is the differential revenue from the acceptance of the offer?
A) $450,000
B) $630,000
C) $510,000
D) $120,000

Quizplus · Accepted Answer

The differential revenue from accepting the offer is calculated by multiplying the number of units (30,000) by the offer price per unit ($15). Therefore, the differential revenue is 30,000 units * $15/unit = $450,000.

Jacoby Company Received an Offer from an Exporter for 30,000