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Stryker Industries received an offer from an exporter for 15,000 units of product at $17.50 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 $20
Unit manufacturing costs:
Variable 11
Fixed 1
1. What is the amount of income or loss from acceptance of the offer?
a. $94,500 loss
b. $97,500 income
c. $37,500 loss
d. $37,500 income

Respuesta :

facundobuzzetti

Answer:

The correct answer is B.

Explanation:

Giving the following information:

Stryker Industries received an offer from an exporter for 15,000 units of product at $17.50 per unit.

Unit manufacturing costs:

Variable 11

Because it is a special offer that will not affect the domestic sales and assuming there is unused capacity, we will not have into account the fixed costs.

Effect on income= 15,000*17.5 - 15,000*11= $97,500