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A Cowarm distribution centre has production capacity of 50,000 crates of ready meals [units) but in the next month sales volume is expected to be

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A Cowarm distribution centre has production capacity of 50,000 crates of ready meals [units) but in the next month sales volume is expected to be 35,000 units at a selling price of 40. Expected costs and revenues for the next month at an activity level of 35,000 units are: E E Bir Lab 112 420,000 Dir Mats 280,000 70,000 Var Manufacturing ehds Fixed Manufacturing ghds. 280,000 Marketing and Distribution 105,000 Total costs 33 1,155,000 Sales 40 1,400,000 Profit 245,000 A new once off customer has offered to purchase 3,000 units next month at 20 a unit but requires their company logo to be attached to every product at an anticipated cost of 1 per unit. They will collect these crates from the distribution centre hence there will be no additional marketing or distribution costs. Currently labour is under intilised. You are Required to: Complete the schedule as per below and advise whether the centre should accept or reject the offer DO NOT Accept Difference Accept Order Relevant Units 35 000 Dost) E E 42 E Dir Lab 12 420 000 Dir Mats 8 250,000 Z 70,000 Var Manufacturing ends. Inserting Logo 1 0 Fixed Manufacturing ehda 3 2B0,000 Marketing and Distribution 3 105,000 Total costs 33 1 155,00D Sales 40 1,400,ODD Profit 245,000

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