The budgeted income for PCY Ltd. for next year is: Sales – 100,000 units @ $20 $2,000,000 Variable manufacturing costs $800,000 Fixed manufacturing costs 300,000 Sales commissions – $1.50 per unit 150,000 Fixed selling and administration expenses 350,000 1,600,000 Operating income $ 400,000 Assume, JNK, a regular customer, has requested PCY Ltd. to provide a quote for a special order of 8,000 units. PCY Ltd. has sufficient capacity to fill the order and would be required to pay only $6,000 in sales commissions. If PCY Ltd. would like the special order to make a contribution to operating income of $28,000, the sales price per unit that should be quoted to the customer for the special order is?
23.
The budgeted income for PCY Ltd. for next year is:
Sales – 100,000 units @ $20 $2,000,000
Variable
Fixed manufacturing costs 300,000
Sales commissions – $1.50 per unit 150,000
Fixed selling and administration expenses 350,000 1,600,000
Operating income $ 400,000
Assume, JNK, a regular customer, has requested PCY Ltd. to provide a quote for a special order of 8,000 units. PCY Ltd. has sufficient capacity to fill the order and would be required to pay only $6,000 in sales commissions. If PCY Ltd. would like the special order to make a contribution to operating income of $28,000, the sales price per unit that should be quoted to the customer for the special order is?
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