"Special Orders"

Theresa M. Odom

ACC 310

Instructor Ivan Makarov

May 25, 2014

Special Orders

4-48. Special Orders

Sherene Nili manages a company that produces wedding gowns. She produces both a custom product that is made to order and a standard product that is sold in bridal salons. Her accountant pre- pared the following forecasted income statement for March, which is a busy month:

Ms. Nili already has orders for the 10 custom dresses reflected in the March forecasted in- come statement. The depreciation charges are for machines used in the respective product lines. Machines depreciate at the rate of 1 per hour based on hours used, so these are variable costs. In March, cutting and sewing machines are expected to operate for 900 hours, of which 600 hours will be used to...