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9:19 Problem: Module 6 Textbook Problem 3 Learning Objective: 6-2 Make appropriate special order decisions Walton Company manufactures a personal computer designed for use
9:19 Problem: Module 6 Textbook Problem 3 Learning Objective: 6-2 Make appropriate special order decisions Walton Company manufactures a personal computer designed for use in schools and markets it under its own label. Walton has the capacity to produce 26,000 units a year but is currently producing and selling only 13,000 units a year. The computer's normal selling price is $1,710 per unit with no volume discounts. The unit-level costs of the computer's production are $480 for direct materials, $190 for direct labor, and $110 for indirect unit-level manufacturing costs. The total product- and facility-level costs incurred by Walton during the year are expected to be $2,280,000 and $817,000, respectively. Assume that Walton receives a special order to produce and sell 3,180 computers at $1,260 each. Required Calculate the contribution to profit from the special order. Should Walton accept or reject the special order? Contribution to profit Should Walton accept or reject the special order?
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