Newtown Sunglasses sell for about $154 per pair. Suppose that the company incurs the following average...

Transcribed Image Text:

Newtown Sunglasses sell for about $154 per pair. Suppose that the company incurs the following average costs per pair: Direct materials Direct labor Variable manufacturing overhead Variable selling expenses Fixed manufacturing overhead $ 39 15 6 3 20* $ 83 Total cost *$2,050,000 Total fixed manufacturing overhead / 102,500 Pairs of sunglasses Newtown has enough idle capacity to accept a one-time-only special order from Water Shades for 17,000 pairs of sunglasses at $80 per pair. Newtown will not incur any variable selling expenses for the order Newtown Sunglasses sell for about $154 per pair. Suppose that the company incurs the following average costs per pair: Direct materials Direct labor Variable manufacturing overhead Variable selling expenses Fixed manufacturing overhead $ 39 15 6 3 20* $ 83 Total cost *$2,050,000 Total fixed manufacturing overhead / 102,500 Pairs of sunglasses Newtown has enough idle capacity to accept a one-time-only special order from Water Shades for 17,000 pairs of sunglasses at $80 per pair. Newtown will not incur any variable selling expenses for the order

Answer rating: 100% (QA)

Answer Should Newtown accept the special order Yes based on the information provided Newtown should ... View the full answer