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Business, 06.05.2021 20:40 keidaniela

Moonbeam Company manufactures toasters. For the first 8 months of 2020, the company reported the following operating results while operating at 75% of plant capacity: Sales (375,200 units) $4,373,000
Cost of goods sold 2,604,960
Gross profit 1,768,040
Operating expenses 839,510
Net income $928,530

Cost of goods sold was 70% variable and 30% fixed; operating expenses were 80% variable and 20% fixed. In September, Moonbeam receives a special order for 20,800 toasters at $8.48 each from Luna Company of Ciudad Juarez. Acceptance of the order would result in an additional $3,000 of shipping costs but no increase in fixed costs.

Required:
a. Prepare an incremental analysis for the special order.
b. Should Moonbeam accept the special order?

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