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31] Bluebird Mfg. has received a special one-time order for 15,000 bird feeders at $3.50 per unit. Bluebird currently produces and sells 75,000 units at $7.50 each. This level represents 80% of its capacity. Production costs for these units are $4.25 per unit, which includes $2.50 variable cost and $1.75 fixed cost. If Bluebird accepts this additional business, the effect on net income will be:

$52,500 increase.
$15,000 increase.
$37,500 increase.
$11,250 decrease.
$37,500 decrease.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91737895

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