Anderson Manufacturing makes a single product. Budget information regarding the current period is given below:
Revenue(100,000 units at $8.00)$800,000
Variable manufacturing overhead235,000
Fixed manufacturing overhead110,000
Dye Company approaches Anderson with a special order for 15,000 units at a price of $7.50 per unit. Variable costs will be the same as the current production and accepting the special order will not have any impact on the rest of the company?s orders. However, Anderson is operating at capacity and will incur an additional $50,000 in fixed manufacturing overhead if the order is accepted.What is the incremental cost associated with accepting the special order?
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