Braizen, Inc. produces a product with a $30 per-unit variable cost and an $80 pe
ID: 2371430 • Letter: B
Question
Braizen, Inc. produces a product with a $30 per-unit variable cost and an $80 per-unit sales price. Fixed manufacturing overhead costs are $100,000. The firm has a one-time opportunity to sell an additional 1,000 units at $60 each that would not affect its current sales. Assuming the company has sufficient capacity to produce the additional units, how would the acceptance of the special order affect net income?
A. Income would decrease by $30,000
B. Income would increase by $30,000
C. Income would increase by $140,000
D. Income would increase by $40,000
Explanation / Answer
B. Income would increase by $30,000