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Category > Accounting Posted 01 Jun 2017 My Price 6.00

Unearthed Company

(5) Unearthed Company makes small widgets. The manufacturing costs per unit to produce a widget are as follows: 

Direct Materials $200 

Direct Labour $150 

Variable Manufacturing Overhead $125 

Fixed Manufacturing Overhead $90 

Total Manufacturing Costs $565 

Variable selling costs to obtain and fill orders normally average $4 per unit when Unearthed sells widgets locally. Unearthed has recently paid $120,000 to advertise in an international magazine. Unearthed has just received an order from a British Company for 1,000 widgets for a total offering price of $450,000. The British Company will pay all shipping charges except the initial packaging costs which are expected to be $1.50 per widget. Unearthed has excess capacity. Should Unearthed Company accept this one time only special order? 

Answers

SuperTutor
(15)
Status NEW Posted 01 Jun 2017 05:06 AM My Price 6.00

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