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19 Problem: Module 6 Textbook Problem 3 Learning Objective: 6-2 Make appropriate special order decisions Campbell Company manufactures a personal computer designed for use
19 Problem: Module 6 Textbook Problem 3 Learning Objective: 6-2 Make appropriate special order decisions Campbell Company manufactures a personal computer designed for use in schools and markets it under its own label. Campbell has the capacity to produce 42,000 units a year but is currently producing and selling only 14,000 units a year. The computer's normal selling price is $1,630 per unit with no volume discounts. The unit-level costs of the computer's production are $500 for direct materials, $270 for direct labor, and $180 for indirect unit-level manufacturing costs. The total product- and facility-level costs incurred by Campbell during the year are expected to be $2,190,000 and $807,000, respectively. Assume that Campbell receives a special order to produce and sell 3,060 computers at $1,240 each. Required Calculate the contribution to profit from the special order. Should Campbell accept or reject the special order? Contribution to profit Should Campbell accept or reject the special order?
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