Jerston Company has an annual plant capacity of 3,000 units. Data concerning this product are given below: The company has received a special order for 500 units at a selling price of $45 each. Regular sales would not be affected, and sales commissions on the 500 units would be reduced by one-third. This special order would have no impact on total fixed costs.
Required:
Determine whether the company should accept the special order. Show all computations.

Question

Jerston Company has an annual plant capacity of 3,000 units. Data concerning this product are given below:  The company has received a special order for 500 units at a selling price of $45 each. Regular sales would not be affected, and sales commissions on the 500 units would be reduced by one-third. This special order would have no impact on total fixed costs.
Required:
Determine whether the company should accept the special order. Show all computations.

Quizplus · Accepted Answer

The Answer of Jerston Company has an annual plant capacity of 3,000 units. Data concerning this product are given below:  The company has received a special order for 500 units at a selling price of $45 each. Regular sales would not be affected, and sales commissions on the 500 units would be reduced by one-third. This special order would have no impact on total fixed costs.
Required:
Determine whether the company should accept the special order. Show all computations.

Jerston Company Has an Annual Plant Capacity of 3,000 Units