Peach has received a special order for 10,000 units of its product. The product normally sells for $29 and has the following manufacturing costs: Direct materials Direct labor Per unit $6 $5 Variable manufacturing overhead $3 Fixed manufacturing overhead Unit cost $11 $25 Assume that Peach has sufficient capacity to fill the order. What price should Peach charge to make a $10,000 incremental profit? a. $25 b. $15 c. $22 d. $29

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter10: Short-term Decision Making
Section: Chapter Questions
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Peach has received a special order for 10,000 units of its product. Please solve this general accounting question

Peach has received a special order for 10,000 units of its product. The product normally sells for $29 and has the
following manufacturing costs:
Direct materials
Direct labor
Per unit
$6
$5
Variable manufacturing overhead $3
Fixed manufacturing overhead
Unit cost
$11
$25
Assume that Peach has sufficient capacity to fill the order. What price should Peach charge to make a $10,000
incremental profit?
a. $25
b. $15
c. $22
d. $29
Transcribed Image Text:Peach has received a special order for 10,000 units of its product. The product normally sells for $29 and has the following manufacturing costs: Direct materials Direct labor Per unit $6 $5 Variable manufacturing overhead $3 Fixed manufacturing overhead Unit cost $11 $25 Assume that Peach has sufficient capacity to fill the order. What price should Peach charge to make a $10,000 incremental profit? a. $25 b. $15 c. $22 d. $29
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