Anglen Company manufactures and sells trophies for winners of athletic and other events. Its manufacturing plant has the capacity to produce 18,500 trophies each month; current monthly production is 15,000.00 trophies. The company normally charges $105.50 per trophy. Cost data for the current level of production are shown below: Variable costs: Direct materials $ 463,300 Direct labor $ 328,300 Selling and administrative $ 17,840 Fixed costs: Manufacturing $ 407,390 Selling and administrative $ 75,880
Anglen Company manufactures and sells trophies for winners of athletic and other events. Its manufacturing plant has the capacity to produce 18,500 trophies each month; current monthly production is 15,000.00 trophies. The company normally charges $105.50 per trophy. Cost data for the current level of production are shown below:
| Variable costs: | |
| Direct materials | $ 463,300 |
|---|---|
| Direct labor | $ 328,300 |
| Selling and administrative | $ 17,840 |
| Fixed costs: | |
| Manufacturing | $ 407,390 |
| Selling and administrative | $ 75,880 |
The company has just received a special one-time order for 925 trophies at $49.00 each. For this particular order, no variable selling and administrative costs would be incurred. This order would also have no effect on fixed costs. Assume that direct labor is a variable cost.
Required:
Should the company accept this special order? Why?
Accepting the order has a financial ________ of _________. Therefore the company _______ accept the order.
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