Cara Industries incurred the following costs for 50,000 units: Variable costs: $90,000 Fixed costs: 120,000 Cara has received a special order from a foreign company for 5,000 units. There is sufficient capacity to fill the order without jeopardizing regular sales. Filling the order will require spending an additional $4,250 for shipping. If Cara wants to earn $4,000 on the order, what should the unit price be? a) $1.65 b) $5.85 c) $3.45 d) $2.60
Cara Industries incurred the following costs for 50,000 units: Variable costs: $90,000 Fixed costs: 120,000 Cara has received a special order from a foreign company for 5,000 units. There is sufficient capacity to fill the order without jeopardizing regular sales. Filling the order will require spending an additional $4,250 for shipping. If Cara wants to earn $4,000 on the order, what should the unit price be? a) $1.65 b) $5.85 c) $3.45 d) $2.60
Chapter10: Short-term Decision Making
Section: Chapter Questions
Problem 4EB: Dimitri Designs has capacity to produce 30,000 desk chairs per year and is currently selling all...
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![Cara Industries incurred the following costs for 50,000 units:
Variable costs: $90,000
Fixed costs: 120,000
Cara has received a special order from a foreign company for 5,000 units.
There is sufficient capacity to fill the order without jeopardizing regular
sales. Filling the order will require spending an additional $4,250 for
shipping.
If Cara wants to earn $4,000 on the order, what should the unit price be?
a) $1.65
b) $5.85
c) $3.45
d) $2.60](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd194941a-e4b3-4883-8d96-bcefaba34798%2Fb9ef32fa-5058-4a36-999d-48dcb9cf68e1%2F3lyzlp_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Cara Industries incurred the following costs for 50,000 units:
Variable costs: $90,000
Fixed costs: 120,000
Cara has received a special order from a foreign company for 5,000 units.
There is sufficient capacity to fill the order without jeopardizing regular
sales. Filling the order will require spending an additional $4,250 for
shipping.
If Cara wants to earn $4,000 on the order, what should the unit price be?
a) $1.65
b) $5.85
c) $3.45
d) $2.60
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