Exercise 12-9 Special Order Decision [LO12-4] Delta Company produces a single product. The cost of producing and selling a single unit of this product at the company’s normal activity level of 85,200 units per year is: Direct materials $ 2.40 Direct labor $ 4.00 Variable manufacturing overhead $ 0.60 Fixed manufacturing overhead $ 4.95 Variable selling and administrative expenses $ 1.80 Fixed selling and administrative expenses $ 3.00 The normal selling price is $22.00 per unit. The company’s capacity is 117,600 units per year. An order has been received from a mail-order house for 2,700 units at a special price of $19.00 per unit. This order would not affect regular sales or the company’s total fixed costs. Required: 1. What is the financial advantage (disadvantage) of accepting the special order? 2. As a separate matter from the special order, assume the company’s inventory includes 1,000 units of this product that were produced last year and that are inferior to the current model. The units must be sold through regular channels at reduced prices. What unit cost is relevant for establishing a minimum selling price for these units?
Exercise 12-9 Special Order Decision [LO12-4] Delta Company produces a single product. The cost of producing...
Exercise 12-9 Special Order Decision (LO12-4] Delta Company produces a single product. The cost of producing and selling a single unit of this product at the company's normal activity level of 84,000 units per year is: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative expenses Fixed selling and administrative expenses $ 2.00 $ 4.00 $ 0.70 $ 3.55 $ 1.80 $ 3.00 The normal selling price is $19.00 per unit. The company's capacity is...
Exercise 12-9 Special Order Decision [LO12-4] Delta Company produces a single product. The cost of producing and selling a single unit of this product at the company's norma activity level of 93,600 units per year is: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative expenses Fixed selling and administrative expenses $ 2.50 $ 3.00 $ 0.90 1.30 $ 2.00 The normal selling price is $21.00 per unit. The company's capacity is 122,400 units per...
Delta Company produces a single product. The cost of producing and selling a single unit of this product at the company’s normal activity level of 98,400 units per year is: Direct materials $ 1.60 Direct labor $ 3.00 Variable manufacturing overhead $ 0.70 Fixed manufacturing overhead $ 4.95 Variable selling and administrative expenses $ 1.30 Fixed selling and administrative expenses $ 2.00 The normal selling price is $25.00 per unit. The company’s capacity is 117,600 units per year. An order...
Exercise 12-9 Special Order Decision (LO12-4) Delta Company produces a single product. The cost of producing and selling a single unit of this product at the company's normal activity level of 105.600 units per year is: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative expenses Fixed selling and administrative expenses $ 2.10 $ 2.80 $8.5e $ 3.85 $ 1.60 $1.ee The normal selling price is $24.00 per unit. The company's capacity is 122.400 units...
Exercise 12-9 Special Order Decision (LO12-4] Delta Company produces a single product. The cost of producing and selling a single unit of this product at the company's normal activity level of 105,600 units per year is: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative expenses Fixed selling and administrative expenses $ 2.40 $ 3.00 $ 0.50 $ 4.05 $ 1.20 $ 2.00 The normal selling price is $20.00 per unit. The company's capacity is...
Delta Company produces a single product. The cost of producing and selling a single unit of this product at the company’s normal activity level of 85,200 units per year is: Direct materials $ 2.10 Direct labor $ 3.00 Variable manufacturing overhead $ 0.70 Fixed manufacturing overhead $ 4.45 Variable selling and administrative expenses $ 1.90 Fixed selling and administrative expenses $ 2.00 The normal selling price is $25.00 per unit. The company’s capacity is 99,600 units per year. An order...
Delta Company produces a single product. The cost of producing and selling a single unit of this product at the company's normal activity level of 85,200 units per year is: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative expenses Fixed selling and administrative expenses $ 1.60 $ 4.00 $ 0.70 $ 3.65 $ 1.50 $ 3.00 The normal selling price is $22.00 per unit. The company's capacity is 106,800 units per year. An order...
Delta Company produces a single product. The cost of producing and selling a single unit of this product at the company’s normal activity level of 103,200 units per year is: Direct materials $ 1.80 Direct labor $ 3.00 Variable manufacturing overhead $ 0.60 Fixed manufacturing overhead $ 3.95 Variable selling and administrative expenses $ 1.50 Fixed selling and administrative expenses $ 2.00 The normal selling price is $19.00 per unit. The company’s capacity is 132,000 units per year. An order...
Delta Company produces a single product. The cost of producing and selling a single unit of this product at the company's normal activity level of 105,600 units per year is: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative expenses Fixed selling and administrative expenses $2.10 $3.00 $ 0.70 $3.45 $1.90 $2.00 The normal selling price is $22.00 per unit. The company's capacity is 139,200 units per year. An order has been received from a...
18. Delta Company produces a single product. The cost of producing and selling a single unit of this product at the company’s normal activity level of 105,600 units per year is: Direct materials $ 2.20 Direct labor $ 4.00 Variable manufacturing overhead $ 0.90 Fixed manufacturing overhead $ 4.55 Variable selling and administrative expenses $ 1.70 Fixed selling and administrative expenses $ 3.00 The normal selling price is $25.00 per unit. The company’s capacity is 120,000 units per year. An...