Saylor BUS105 Exam - Topic 2 Question 3 Discussion

Actual exam question for Saylor's BUS105 exam

Question #: 3
Topic #: 2

Cat Hats Inc. produces lines of headwear for cats. They have been asked by a local animal shelter to produce a special order for dogs. Below is a special order differential analysis prepared by their managerial accountant. Using this information, what would be the result of accepting the special order?

AA differential profit of ($550)

BA differential profit of ($700)

CA differential contribution margin of $550

DA differential contribution margin of $700

Show Suggested Answer

Suggested Answer: A

by Lonny at Jul 04, 2025, 03:47 AM

Limited Time Offer

25%

Off

Get Premium BUS105 Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

Submit Cancel

Hoa

4 months ago

Not sure about those numbers, seems off to me.

upvoted 0 times

...

Maile

4 months ago

Definitely looks like a $700 contribution margin.

upvoted 0 times

...

Evelynn

4 months ago

I think the contribution margin is key here.

upvoted 0 times

...

Reynalda

4 months ago

No way they should make dog hats! Cats only!

upvoted 0 times

...

Stefania

4 months ago

Surprised they even considered this order!

upvoted 0 times

...

Rana

5 months ago

I vaguely recall that we should focus on the incremental costs and revenues. I think I lean towards option A, but I'm not completely confident.

upvoted 0 times

...

Loreen

5 months ago

I feel like I might be mixing up contribution margin and profit. Is it possible that option D is correct since it mentions a contribution margin of $700?

upvoted 0 times

...

Christiane

5 months ago

This seems similar to a practice question we did about calculating contribution margins. I think the differential profit could be negative if costs exceed revenue.

upvoted 0 times

...

Loren

5 months ago

I remember we discussed differential analysis in class, but I'm not sure how to apply it to this special order for dogs.

upvoted 0 times

...

Tequila

5 months ago

I feel pretty confident about this type of problem. The key is to identify the relevant incremental costs and revenues, and then calculate the differential profit or contribution margin. I'll double-check my work, but I think I can handle this one.

upvoted 0 times

...

Lashon

6 months ago

This is a tricky one. I'll need to make sure I'm interpreting the information correctly and not missing any important details. I'll walk through the analysis step-by-step to ensure I arrive at the right answer.

upvoted 0 times

...

Tabetha

6 months ago

Okay, I think I've got this. The key is to focus on the incremental or differential costs and revenues associated with the special order. If the additional revenue exceeds the incremental costs, then the special order would result in a differential profit.

upvoted 0 times

...

Carmelina

6 months ago

Hmm, I'm a bit unsure about this one. The question is asking for the result of accepting the special order, but the information seems to be focused on a differential analysis. I'll need to make sure I understand the connection between the two.

upvoted 0 times

...

Chery

6 months ago

This looks like a classic differential analysis problem. I'll need to carefully review the information provided and think through the incremental costs and revenues to determine the impact on profit.

upvoted 0 times

...

Cherelle

8 months ago

The contribution margin would also be $700, so it's a good deal overall.

upvoted 0 times

...

Glendora

8 months ago

Hold up, are we sure this isn't a trick question? I mean, who orders dog hats from a cat hat company? Anyway, I'm sticking with Option D, the $700 contribution margin.

upvoted 0 times

...