Question
8. Homestead Jeans Co. has an annual plant capacity of 64,600 units, and current production is 45,300 units. Monthly fixed costs are $54,500, and variable
8. Homestead Jeans Co. has an annual plant capacity of 64,600 units, and current production is 45,300 units. Monthly fixed costs are $54,500, and variable costs are $33 per unit. The present selling price is $44 per unit. On November 12 of the current year, the company received an offer from Dawkins Company for 17,800 units of the product at $35 each. Dawkins Company will market the units in a foreign country under its own brand name. The additional business is not expected to affect the domestic selling price or quantity of sales of Homestead Jeans Co.
C. What is the minimum price per unit that would produce a positive contribution margin? If required, round your answer to two decimal places.
$_______
A. Prepare a differential analysis dated November 12 on whether to reject (Alternative 1) or accept (Alternative 2) the Dawkins order. Refer to the lists of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. Be sure to complete the statement heading. For those boxes in which you must enter subtracted or negative numbers use a minus sign. If there is no amount or an amount is zero, enter "O". A colon () will automatically appear if required. Question not attempted. Score: 0/55 Differential Analysis Reject Order (Alternative 1) or Accept Order (Alternative 2) (Label) 1 Reject Order Accept Order Differential Effect on Income (Alternative 2) 2 (Alternative 1) (Alternative 2) 3 - (Label) 5Step by Step Solution
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