Wheel Company makes a product, K9. It has a production capacity of 1,000 units, and it can sell all of 1,000 units to its regular customers. The regular selling price is $60 each. Wheel has received a request from Tom for a special order of 100 units of K9. This special order does not incur any variable selling cost. The following is the per-unit cost information: Variable manufacturing $18 Fixed manufacturing $20* Unit manufacturing cost $38 Variable selling $4 Fixed selling $8* Unit selling cost $12 Total cost $50 * based on production and sales of 1,000 units Whelel has received a speciar order from Tom (who is not a regular customer). He wants to buy 100 units at a discounted price. Wheell does not want the company's profit to decline by accepting the order from Tom. Then, Wheel has to charge at least _____ to Tom for each unit of K9. A. $18 B. $24 C. $46 D. $60 E. $56
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Wheel Company makes a product, K9. It has a production capacity of 1,000 units, and it can sell all of 1,000 units to its regular customers. The regular selling price is $60 each. Wheel has received a request from Tom for a special order of 100 units of K9. This special order does not incur any variable selling cost. The following is the per-unit cost information:
Variable manufacturing
$18
Fixed manufacturing
$20*
Unit
manufacturing cost $38
Variable selling
$4
Fixed selling
$8*
Unit selling cost
$12
Total cost
$50
* based on production and sales of 1,000 units
Whelel has received a speciar order from Tom (who is not a regular customer). He wants to buy 100 units at a discounted price. Wheell does not want the company's profit to decline by accepting the order from Tom. Then, Wheel has to charge at least _____ to Tom for each unit of K9.
A. $18
B. $24
C. $46
D. $60
E. $56
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