Pearson Industries has received a special order for 12,000 units of its product. The product normally sells for $35 and has the following manufacturing costs: Direct materials Direct labor Per unit $7 $6 Variable manufacturing overhead $4 Fixed manufacturing overhead $12 Unit cost $29 Assume that Pearson has sufficient capacity to fill the order. What price should Pearson charge to make a $12,000 incremental profit?
Pearson Industries has received a special order for 12,000 units of its product. The product normally sells for $35 and has the following manufacturing costs: Direct materials Direct labor Per unit $7 $6 Variable manufacturing overhead $4 Fixed manufacturing overhead $12 Unit cost $29 Assume that Pearson has sufficient capacity to fill the order. What price should Pearson charge to make a $12,000 incremental profit?
Chapter10: Short-term Decision Making
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Transcribed Image Text:Pearson Industries has received a special order for 12,000
units of its product. The product normally sells for $35
and has the following manufacturing costs:
Direct materials
Direct labor
Per unit
$7
$6
Variable manufacturing overhead $4
Fixed manufacturing overhead $12
Unit cost
$29
Assume that Pearson has sufficient capacity to fill the
order. What price should Pearson charge to make a
$12,000 incremental profit?
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