SloGrowth Has Idle Capacity

SloGrowth has idle capacity.They have received a special order for 2000 units at a price of $6 per unit.Currently production and sales are budgeted for 20 000 units without considering the special order.Budget information for the year is presented below.Cost of goods sold includes $20 000 of fixed manufacturing cost.Determine the effect on profit if the special order is accepted.

A) Remains the same
B) Increase by $2000
C) Decrease by $2000
D) Decrease by $1000

Correct Answer:

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