Jacoby Company received an offer from an exporter for 21,300 units of product at $17 per unit. The acceptance of the offer will not affect normal production or domestic sales prices. The following data are available: Domestic unit sales price $25 Unit manufacturing costs: Variable 13 Fixed 3 The differential revenue from the acceptance of the offer is a.$532,500 b.$894,600 c.$362,100

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anthougo anthougo · Answer 1 · 2022-07-26T19:43:59+02:00

The differential revenue from the acceptance of the offer by Jacoby Corporation is d. $85,200.

The differential revenue is the revenue lost when a company rejects a special order or an alternative decision is made.

Exporter's offer = 21,300 units at $17 per unit

Domestic selling price per unit = $25

Variable costs per unit = $13

Fixed costs per unit = $3

Contribution margin per unit based on the special offer = $4 ($17 - $13)

Differential revenue = $85,200 ($4 x 21,300)

Thus, the differential revenue from the acceptance of the offer by Jacoby Corporation is d. $85,200.

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a. $532,500

b. $894,600

c. $362,100

d. $85,200