Gracius Manufacturing is approached by a European customer to fulfill a one-time-only special order for a product similar to one offered to domestic customers. Gracius Manufacturing has a policy of adding a 20% markup to full costs and currently has excess capacity. The following per unit data apply for sales to regular customers: Variable costs: Direct materials Direct labor Manufacturing overhead Marketing costs Fixed costs: Manufacturing overhead Marketing costs $90 30 40 30 A) $432 B) $360 C) $90 D) $140 180 10 380 Total costs Markup (10% of total costs) Estimated selling price What is the full cost of the product per unit for Gracius Manufacturing? 56 $336
Gracius Manufacturing is approached by a European customer to fulfill a one-time-only special order for a product similar to one offered to domestic customers. Gracius Manufacturing has a policy of adding a 20% markup to full costs and currently has excess capacity. The following per unit data apply for sales to regular customers: Variable costs: Direct materials Direct labor Manufacturing overhead Marketing costs Fixed costs: Manufacturing overhead Marketing costs $90 30 40 30 A) $432 B) $360 C) $90 D) $140 180 10 380 Total costs Markup (10% of total costs) Estimated selling price What is the full cost of the product per unit for Gracius Manufacturing? 56 $336
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Gracius Manufacturing is approached by a European customer to fulfill
a one-time-only special order for a product similar to one offered to
domestic customers. Gracius Manufacturing has a policy of adding a
20% markup to full costs and currently has excess capacity. The
following per unit data apply for sales to regular customers:
Variable costs:
Direct materials
Direct labor
Manufacturing overhead
Marketing costs
Fixed costs:
Manufacturing overhead
Marketing costs
$90
30
40
30
180
10
380
Total costs
Markup (10% of total costs)
Estimated selling price
What is the full cost of the product per unit for Gracius Manufacturing?
A) $432
B) $360
C) $90
D) $140
56
$336
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