Selling price is $1240 where as Variable cost is as under:
1. Direct Material= $520
2. Direct Labor= $140
3. Indirect Manufacturing Cost= $110
Total Variable cost comes to $970
Hence Contribution would be $270(1240-970 that is Sales-Variable cost).
Hence Thomton should accept the special order as contribution is positive in this case.
ecture 13 homework Thornton Company manufactures a personal computer designed for use in schools and markets it u...
Award: 8.00 points Thornton Company manufactures a personal computer designed for use in schools and markets it under its own label. Thornton has the capacity to produce 38,000 units a year but is currently producing and selling only 10,000 units a year. The computer's normal selling price is $1,640 per unit with no volume discounts. The unit-level costs of the computer's production are $590 for direct materials, $210 for direct labor, and $190 for indirect unit-level manufacturing costs. The total...
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