Peach has received a special order for 10,000 units of its product. The product normally sells for $29 and has the following manufacturing costs: Per unit Direct materials $ 6 Direct labor 5 Variable manufacturing overhead 3 Fixed manufacturing overhead 11 Unit cost $ 25 Assume that Peach has sufficient capacity to fill the order. What price should Peach charge to make a $10,000 incremental profit? Multiple Choice $25 $22 $29 $15
Peach has received a special order for 10,000 units of its product. The product normally sells for $29 and has the following manufacturing costs: Per unit Direct materials $ 6 Direct labor 5 Variable manufacturing overhead 3 Fixed manufacturing overhead 11 Unit cost $ 25 Assume that Peach has sufficient capacity to fill the order. What price should Peach charge to make a $10,000 incremental profit? Multiple Choice $25 $22 $29 $15
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter17: Activity Resource Usage Model And Tactical Decision Making
Section: Chapter Questions
Problem 18E: A company is considering a special order for 1,000 units to be priced at 8.90 (the normal price...
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Peach has received a special order for 10,000 units of its product. The product normally sells for $29 and has the following
Per unit | |||
Direct materials | $ | 6 | |
Direct labor | 5 | ||
Variable manufacturing |
3 | ||
Fixed manufacturing overhead | 11 | ||
Unit cost | $ | 25 | |
Assume that Peach has sufficient capacity to fill the order. What price should Peach charge to make a $10,000 incremental profit?
Multiple Choice
-
$25
-
$22
-
$29
-
$15
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