P26-1A ThreePoint Sports Inc. manufactures basketballs for the Women's National Basket- ball Association (WNBA). For the

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P26 1a Threepoint Sports Inc Manufactures Basketballs For The Women S National Basket Ball Association Wnba For The 1 (231.42 KiB) Viewed 14 times

P26-1A ThreePoint Sports Inc. manufactures basketballs for the Women's National Basket- ball Association (WNBA). For the first 6 months of 2017, the company reported the follow- ing operating results while operating at 80% of plant capacity and producing 120,000 units. Use incremental analysis for special order and identify nonfinancial factors in the decision. Amount (LO 2) Sales $4,800,000 Cost of goods sold 3,600,000 Selling and administrative expenses 405,000 Net income $ 795,000 Fixed costs for the period were cost of goods sold $960,000, and selling and administrative expenses $225,000. In July, normally a slack manufacturing month, ThreePoint Sports receives a special order for 10,000 basketballs at $28 each from the Greek Basketball Association (GBA). Acceptance of the order would increase variable selling and administrative expenses $0.75 per unit because of shipping costs but would not increase fixed costs and expenses. Instructions (a) Prepare an incremental analysis for the special order. (a) NI increase $37,500 (b) Should ThreePoint Sports Inc. accept the special order? Explain your answer. (c) What is the minimum selling price on the special order to produce net income of $5.00 per ball? (d) - What nonfinancial factors should management consider in making its decision?