Question No. 1-1 The HASF Company has an annual plant capacity of 50,000 units. Predicted data on sales and costs are given below. Sales (50 per unit) 1,000,000 Manufacturing cost Variable (material labor and overhead) Fixed overhead Selling and administrative expenses Variable (sales commission RS 0.5 per unit) Fixed 40 per unit 30,000 2 per unit 7,000 A special order has been received from outside for 5,000 units at a selling price of 45 per unit this order will no effect on regular sales. The usual sales commission on this order will be reduced by one half. Required: a. Should the company accept / reject the order? b. Keeping in view the above answer narrate rationale to support your answer
Question No. 1-1 The HASF Company has an annual plant capacity of 50,000 units. Predicted data on sales and costs are given below. Sales (50 per unit) 1,000,000 Manufacturing cost Variable (material labor and overhead) Fixed overhead Selling and administrative expenses Variable (sales commission RS 0.5 per unit) Fixed 40 per unit 30,000 2 per unit 7,000 A special order has been received from outside for 5,000 units at a selling price of 45 per unit this order will no effect on regular sales. The usual sales commission on this order will be reduced by one half. Required: a. Should the company accept / reject the order? b. Keeping in view the above answer narrate rationale to support your answer
Chapter3: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 1PB: A company sells mulch by the cubic yard. Grade A much sells for $150 per cubic yard and has variable...
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