Gallerani Corporation has received a request for a special o…

Gallerani Corporation has received a request for a special order of 6,000 units of product A90 for $21.2 each. Product A90’s unit product cost is $16.20, determined as follows: direct materials 6.10 direct labor 4.20 variable manufacturing overhead 2.30 fixed manufacturing overhead 3.60 unit product cost 16.20 Direct labor is a variable cost. The special order would have no effect on the company’s total fixed manufacturing overhead costs. The customer would like modifications made to product A90 that would increase the variable costs by $4.20 per unit and that would require an investment of $21,000 in special molds that would have no salvage value.This special order would have no effect on the company’s other sales. The company has ample spare capacity for producing the special order. If the special order is accepted, the company’s overall net operating income would increase (decrease) by:

At a volume of $20,000 direct labor hours, Tirso company inc…

At a volume of $20,000 direct labor hours, Tirso company incurs $50,000 in factory overhead costs, including $10,000 in fixed costs. Assuming that this activity is within the relevant range, if volume increases to 25,000 direct labor hours, Tirso Company would expect to incur total factory overhead costs of: