Z Motor Inc. manufactures and sell a range of automobile parts. The regular price and costs data for Part C are as follows: Price and Cost Data for Part C Price and Costs Amount Market selling price $79 Variable costs per unit $35 Fixed costs per unit (allocated) $25 Z Motor received an offer from an exporter to sell 5,000 units of Part C for $49 per unit. The company has enough capacity to fulfill this offer. Acceptance of this offer will not affect the company’s regular sale. The amount of profit or loss from the acceptance of the offer would be: Group of answer choices $70,000 profit $245,000 profit $150,000 loss $55,000 loss
Z Motor Inc. manufactures and sell a range of automobile parts. The regular price and costs data for Part C are as follows: Price and Cost Data for Part C Price and Costs Amount Market selling price $79 Variable costs per unit $35 Fixed costs per unit (allocated) $25 Z Motor received an offer from an exporter to sell 5,000 units of Part C for $49 per unit. The company has enough capacity to fulfill this offer. Acceptance of this offer will not affect the company’s regular sale. The amount of profit or loss from the acceptance of the offer would be: Group of answer choices $70,000 profit $245,000 profit $150,000 loss $55,000 loss
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Z Motor Inc. manufactures and sell a range of automobile parts. The regular price and costs data for Part C are as follows:
Price and Cost Data for Part C| Price and Costs | Amount |
|---|---|
| Market selling price | $79 |
| Variable costs per unit | $35 |
| Fixed costs per unit (allocated) | $25 |
Z Motor received an offer from an exporter to sell 5,000 units of Part C for $49 per unit. The company has enough capacity to fulfill this offer. Acceptance of this offer will not affect the company’s regular sale.
The amount of profit or loss from the acceptance of the offer would be:
Group of answer choices
$70,000 profit
$245,000 profit
$150,000 loss
$55,000 loss
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