Delta Company produces a single product. The cost of producing and selling a single unit of this pro
Delta Company produces a single product. The cost of producing and selling a single unit of this product at the company's normal activity level of 90,000 units per year is: 1.80 $ 2.00 $ .80 $3.75 Variable selling and administrative expenses $ 1.60 $ 1.00 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling and administrative expenses The normal selling price is $19 per unit. The company's capacity is 114,000 units per year. An order has been received from a mail-order house for 2,000 units at a special price of $16.00 per unit. This order would not affect regular sales. Required: 1. If the order is accepted, by how much will annual profits be increased or decreased? (The order will not change the company's total fixed costs.) Annual profits would by
