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20 15 Dots Kneller Company manufactures and sells medals for winners of athletic and other events. Its manufacturing plant has the capacity to produce 17,000
20 15 Dots Kneller Company manufactures and sells medals for winners of athletic and other events. Its manufacturing plant has the capacity to produce 17,000 medals each month; current monthly production is 10,000 medals. The company normally charges $91 per medal. Cost data for the current level of production are shown below: Variable costs: Direct materials $441,200 Direct labor $ 141,200 Selling and administrative $ 22.900 Fixed costs: Manufacturing $ 132,100 Selling and administrative $72,300 The company has just received a special one-time order for 400 medals at $72 each. For this particular order, no variable selling and administrative costs would be incurred. This order would also have no effect on fixed costs. Assume that direct labor is a variable cost Required: Should the company accept this special order? 8 0402 Accepted O Not accepted
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