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A customer has requested that ABC Corporation a special order for 2.600 units of product 547 for $31 a une. While the product would be modified slightly for the special order, product 547% normal unt product cost is $20.70 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Dit product cost Assume that direct labor in a variable cost The special order would have no effect on the company's total faxed manufacturing overhead costs The customer would like modifications made to product 547 that would increase the valabile costs by $180 per unt and that would require an investment of $16,000.00 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. The annual financial advantage (disadvantage) for the company as a result of accepting this special order should Mungle Choice $.6.20 3.30 8.20 $ 20.70 mass

A customer has requested that ABC Corporation a special order for 2.600 units of product 547 for $31 a une. While the product would be modified slightly for the special order, product 547% normal unt product cost is $20.70 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Dit product cost Assume that direct labor in a variable cost The special order would have no effect on the company's total faxed manufacturing overhead costs The customer would like modifications made to product 547 that would increase the valabile costs by $180 per unt and that would require an investment of $16,000.00 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. The annual financial advantage (disadvantage) for the company as a result of accepting this special order should Mungle Choice $.6.20 3.30 8.20 $ 20.70 mass

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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A customer has requested that ABC Corporation fill a special order for 2,500 units of product 547 for $31 a unt. While the product would be modified slightly for the special ordet, product 547's normal unit product cost is $2070 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Unit product cost Assume that 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 547 that would increase the variable costs by $180 per unit and that would require an investment of $16,000.00 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. The annual financial advantage (disadvantage) for the company as a result of accepting this special order should be: Mutiple Choice 127420 $5700) 516,200 $.6.20 3.00 3.30 8.20 $20.70 THE ($2,400)
Transcribed Image Text:A customer has requested that ABC Corporation fill a special order for 2,500 units of product 547 for $31 a unt. While the product would be modified slightly for the special ordet, product 547's normal unit product cost is $2070 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Unit product cost Assume that 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 547 that would increase the variable costs by $180 per unit and that would require an investment of $16,000.00 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. The annual financial advantage (disadvantage) for the company as a result of accepting this special order should be: Mutiple Choice 127420 $5700) 516,200 $.6.20 3.00 3.30 8.20 $20.70 THE ($2,400)
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