Lattimer Company had the following results of operations for the past year: A foreign company offers to buy 5,000 units at $7.50 per unit. In addition to existing costs, selling these units would add a $0.25 selling cost for export fees. Lattimer's annual production capacity is 25,000 units. If Lattimer accepts this additional business, the special order will yield a:
A) $2,000 loss.
B) $8,250 loss.
C) $3,750 profit.
D) $3,250 loss.
E) $5,000 profit.

Question

Lattimer Company had the following results of operations for the past year:  A foreign company offers to buy 5,000 units at $7.50 per unit. In addition to existing costs, selling these units would add a $0.25 selling cost for export fees. Lattimer's annual production capacity is 25,000 units. If Lattimer accepts this additional business, the special order will yield a:
A) $2,000 loss. 
B) $8,250 loss. 
C) $3,750 profit. 
D) $3,250 loss. 
E) $5,000 profit.

Quizplus · Accepted Answer

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Lattimer Company Had the Following Results of Operations for the Past