Thornton Concrete Company pours concrete slabs for single-family dwellings. Lancing Construction Company, which operates outside Thornton's normal sales territory, asks Thornton to pour 47 slabs for Lancing's new development of homes. Thornton has the capacity to build 440 slabs and is presently working on 190 of them. Lancing is willing to pay only $2,510 per slab. Thornton estimates the cost of a typical job to include unit-level materials, $900; unit-level labor, $480; and an allocated portion of facility-level overhead, $1,180. Required Calculate the contribution to profit from the special order. Should Thornton accept or reject the special order to pour 47 slabs for $2,510 each? Contribution to profit Should Thornton accept or reject the special order? Accept
Thornton Concrete Company pours concrete slabs for single-family dwellings. Lancing Construction Company, which operates outside Thornton's normal sales territory, asks Thornton to pour 47 slabs for Lancing's new development of homes. Thornton has the capacity to build 440 slabs and is presently working on 190 of them. Lancing is willing to pay only $2,510 per slab. Thornton estimates the cost of a typical job to include unit-level materials, $900; unit-level labor, $480; and an allocated portion of facility-level overhead, $1,180. Required Calculate the contribution to profit from the special order. Should Thornton accept or reject the special order to pour 47 slabs for $2,510 each? Contribution to profit Should Thornton accept or reject the special order? Accept
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Thornton Concrete Company pours concrete slabs for single-family dwellings. Lancing Construction Company, which operates outside
Thornton's normal sales territory, asks Thornton to pour 47 slabs for Lancing's new development of homes. Thornton has the capacity
to build 440 slabs and is presently working on 190 of them. Lancing is willing to pay only $2,510 per slab. Thornton estimates the cost
of a typical job to include unit-level materials, $900; unit-level labor, $480; and an allocated portion of facility-level overhead, $1,180.
Required
Calculate the contribution to profit from the special order. Should Thornton accept or reject the special order to pour 47 slabs for
$2,510 each?
Contribution to profit
Should Thornton accept or reject the special order?
Accept
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