Question

Bramble Sports Inc. manufactures basketballs for the Women’s National Basketball Association (WNBA). For the first 6 months of 2017, the company reported the following operating results while operating at 80% of plant capacity and producing 119,700 units. Amount Sales $4,788,000 Cost of goods sold 3,559,884 Selling and administrative expenses 468,445 Net income $759,671 Fixed costs for the period were cost of goods sold $960,000, and selling and administrative expenses $247,000. In July, normally a slack manufacturing month, Bramble Sports receives a special order for 10,000 basketballs at $29 each from the Greek Basketball Association (GBA). Acceptance of the order would increase variable selling and administrative expenses $0.75 per unit because of shipping costs but would not increase fixed costs and expenses.

Your answer is correct. Prepare an incremental analysis for the special order. (Round all per unit computations to 2 decimal places, e.g. 15.25. If amount decreases net income then enter the amount using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Reject Order Accept Order Net Income Increase (Decrease) Revenues $     $ 290000 $ 290000 Cost of goods sold     217200 (217200) Selling and administrative expenses     26,000 (26,000) Net income $     $ 46800 $ 46800 Should Bramble Sports Inc. accept the special order? Yes

Your answer is incorrect. Try again. What is the minimum selling price on the special order to produce net income of $5.09 per ball? (Round answer to 2 decimal places, e.g. 15.25.) Minimum selling price $

Answer 1

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