Problem 7-1A_ShurShot Sports Inc._Accept or reject the order

Problem 7-1A (Part Level Submission)

ShurShot
Sports Inc. manufactures basketballs for the National Basketball Association
(NBA). For the first 6 months of 2014, the company reported the following
operating results while operating at 80% of plant capacity and producing
119,800 units.

Amount
Sales $5,031,600
Cost
of goods sold 3,686,450
Selling
and administrative expenses 596,604
Net
income $748,546

Fixed
costs for the period were cost of goods sold $1,080,800, and selling and
administrative expenses $298,302.

In
July, normally a slack manufacturing month, ShurShot Sports receives a special
order for 10,800 basketballs at $28 each from the Greek Basketball Association
(GBA). Acceptance of the order would increase variable selling and administrative
expenses $0.50 per unit because of shipping costs but would not increase fixed
costs and expenses.
Prepare an incremental analysis for the special
order. (Round all per unit computations to 2 decimal places, e.g. 15.25. Enter
negative amounts 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
$ $ $
Cost
of goods sold
Selling
and administrative expenses
Net
income $ $ $