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Question(s) / Instruction(s):

Able Company’s unit manufacturing cost is:

Variable Costs                $50

Fixed Costs                      25

A special order for 1,000 units has been received from a foreign company.  The unit price requested is $55.  The normal unit price is $80.  If the order is accepted, unit variable costs will increase by $2 for additional freight costs.  If the order is accepted, incremental profit (loss) will be which of the following?

A.            $(23,000)

B.            $3,000

C.            $(20,000)

D.            $5,000

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