Business, 05.05.2020 18:31 palafox9898
CoolAir Corporation manufactures window air conditioners. CoolAir has the capacity to manufacture and sell 80,000 air conditioners each year but is currently only manufacturing and selling 60,000. The following unit cost data relate to annual operations at 60.000 units: Selling price $125 Variable manufacturing $25 cost Fixed manufacturing $40 cost Variable selling and administrative cost Fixed selling and administrative cost $10 $15 The City of Clearwater would like to purchase 3,000 air conditioners from CoolAir but only if they can buy them for $75 each. Variable selling and administrative costs on this special order would decrease to $2 per unit if CoolAir accepted the order. This order would not affect the 60,000 units of regular sales and would not affect total fixed costs. The annual financial advantage (disadvantage) for CoolAir of accepting this special order from the City of Clearwater would be: a. $21,000 b. $24,000 c. $144,000 d. $129.000e. None of the above
Answers: 1
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CoolAir Corporation manufactures window air conditioners. CoolAir has the capacity to manufacture an...
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