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ecture 13 homework Thornton Company manufactures a personal computer designed for use in schools and markets it under its own
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Answer #1

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.

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