Chapter 8 Question 2Please help me answer the part in red. I know it is NOT 572,000 nor is it 457,600. Thank you! Flint Company is a leading manufacturer of sunglasses. One of Flint's products protects the eyes from ultraviolet rays. An upscalesporting goods store has contacted Flint about purchasing 28,600 pairs of these sunglasses. Flint's unit manufacturing cost, basedon a full capacity of 241,000 units, is as follows:Direct materials$6Direct labor4Manufacturing overhead (75% fixed)24Total manufacturing costs$34Flint also incurs selling and administrative expenses of $74,100 plus $2 per pair for sales commissions. The company has plenty ofexcess manufacturing capacity to use in manufacturing the sunglasses. Flint's normal price for these sunglasses is $40 per pair. Thesporting goods store has offered to pay $34 per pair. Since the special order was initiated by the sporting goods store, no salescommission will be paid.What would be the effect on Flint's income if the special order were accepted?Flint's income will increaseby $457600

NOTE : NO ADDITIONAL FIXED COST TO BE INCURRED AS THE COMPANY IS HAVING EXCESS CAPACITY…

Flint Company is a leading manufacturer of sunglasses. One of Flint's products protects the eyes from ultraviolet rays. An upscale sporting goods store has contacted Flint about purchasing 28,600 pairs of these sunglasses. Flint's unit manufacturing cost, based on a full capacity of 241,000 units, is as follows: Direct materials $6 Direct labor 4 Manufacturing overhead (75% fixed) $34 24 Total manufacturing costs Flint also incurs selling and administrative expenses of $74,100 plus $2 per pair for sales commissions. The company has plenty of excess manufacturing capacity to use in manufacturing the sunglasses. Flint's normal price for these sunglasses is $40 per pair. The sporting goods store has offered to pay $34 per pair. Since the special order was initiated by the sporting goods store, no sales commission will be paid. What would be the effect on Flint's income if the special order were accepted? Flint's income will increase by $ 457600

Flint Company is a leading manufacturer of sunglasses. One of Flint's products protects the eyes from ultraviolet rays. An upscale sporting goods store has contacted Flint about purchasing 28,600 pairs of these sunglasses. Flint's unit manufacturing cost, based on a full capacity of 241,000 units, is as follows: Direct materials $6 Direct labor 4 Manufacturing overhead (75% fixed) $34 24 Total manufacturing costs Flint also incurs selling and administrative expenses of $74,100 plus $2 per pair for sales commissions. The company has plenty of excess manufacturing capacity to use in manufacturing the sunglasses. Flint's normal price for these sunglasses is $40 per pair. The sporting goods store has offered to pay $34 per pair. Since the special order was initiated by the sporting goods store, no sales commission will be paid. What would be the effect on Flint's income if the special order were accepted? Flint's income will increase by $ 457600

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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