CourseLover

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    Devry University
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Category > Accounting Posted 18 Dec 2017 My Price 10.00

average costs for a medal

Hampton Company manufactures and sells medals for winners of athletic events. The company normally charges $33 per medal. The average costs for a medal is shown below.

 

Direct materials:                          $12

Direct labor:                                    8

Variable manufacturing overhead:      6

Variable marketing expenses:           2

Fixed manufacturing overhead:       10($500,000 fixed manufacturing overhead/50,000 medals)

Total costs:                                 $38

 

Hampton Company has enough idle capacity to accept a one-time only special order for 5,000 medals at $25 per medal. Hampton Company will not incur any variable marketing expenses for this order and no additional fixed costs.

 

Required

 

Should the company accept this special order? Please state your decision and provide numerical support for your decision.(Points : 25)

Answers

CourseLover
(12)
Status NEW Posted 18 Dec 2017 01:12 PM My Price 10.00

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