Avocado has received a special order for 2,400 units of its product at a special price. The product normally sells for $440 and has the followingmanufacturing costs:Per unitDirect materials$128Direct labor83Variable manufacturing overhead68Fixed manufacturing overhead120Unit cost$399Assume that Avocado has sufficient capacity to fill the order. What special order price should Avocado charge to make a $12,000 incremental profit? Dundee Company currently produces three products from a joint process. The joint process has total costs of $286,000 per month. All three products, A,B & C, are immediately saleable as they come out of the joint process. Alternatively, any of the products could continue on with additional processing andbe sold as a more complete product. The following information is available:LaterUnit CostImmediateof FurtherProcessingSalesUnitsSales PricePriceA 24,000B 48,000$ 9$ 6$13$6$11$2C 72,000$10$15$ 4Which of the products should be sold after further processing?

Avocado has received a special order for 2,400 units of its product at a special price. The product normally sells for $440 and has the following manufacturing costs: Per unit Direct materials $128 Direct labor 83 Variable manufacturing overhead 68 Fixed manufacturing overhead Unit cost 120 $399 Assume that Avocado has sufficient capacity to fill the order. What special order price should Avocado charge to make a $12,000 incremental profit?

Avocado has received a special order for 2,400 units of its product at a special price. The product normally sells for $440 and has the following manufacturing costs: Per unit Direct materials $128 Direct labor 83 Variable manufacturing overhead 68 Fixed manufacturing overhead Unit cost 120 $399 Assume that Avocado has sufficient capacity to fill the order. What special order price should Avocado charge to make a $12,000 incremental profit?

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter4: Extent (how Much) Decisions

Section: Chapter Questions

Problem 4.2IP

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