Benson Company manufactures a personal computer designed for use in schools and markets it under its own label. Benson has thecapacity to produce 37,000 units a year but is currently producing and selling only 13,000 units a year. The computer's normal sellingprice is $1,620 per unit with no volume discounts. The unit-level costs of the computer's production are $570 for direct materials, $200for direct labor, and $140 for indirect unit-level manufacturing costs. The total product- and facility-level costs incurred by Bensonduring the year are expected to be $2,270,000 and $817,000, respectively. Assume that Benson receives a special order to produceand sell 3,080 computers at $1,300 each.RequiredCalculate the contribution to profit from the special order. Should Benson accept or reject the special order?Contribution to profitShould Benson accept or reject the special order?

The fixed costs are not incurred for the special order. The variable costs are to be incurred for…

Answered: Benson Company manufactures a personal…

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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