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Question
A company is currently operating at 75% capacity and producing 3,000 units. Current cost information relating to this production is shown in the table below:Per Unit
Sales price $43
Direct material $7
Direct labor $6
Variable overhead $4
Fixed overhead $4
The company has been approached by a customer with a request for a 200-unit special. What is the minimum per unit sales price that management would accept for this order if the company wishes to increase current profits?
A. Any amount over $43 per unit.
B. Any amount over $17 per unit.
C. Any amount over $21 per unit.
D. Any amount over $13 per unit.
E. Any amount over $22 per unit.
Answer
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