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ABC Company requires a 20 percent profit on new product. It in the process of releasing a new version of tablet. The tablet has a
ABC Company requires a 20 percent profit on new product. It in the process of releasing a new version of tablet. The tablet has a target price of 550.00 Required: Compute the amount of desired profit. a) (1 Mark) b) Compute the target cost. (1 Mark) ABC Company manufactures a Product S and the per unit data pertaining to this product are as follow: Sale price 45.60 $ 9.60 Direct materials Direct labor 12.00 Variable overhead 10.80 Fixed overhead The company has sufficient capacity to accept a special order for 27,500 units that it just received. Selling costs associated with this order would be 3.60 per unit. Required: Compute the minimum selling price per unit. c) (2 Marks) d) If the purchaser is willing to pay the company a (3 Marks) Accept/Reject price of 33.60 per unit, should the company accept the special order. Support your recommendation with the operating income/loss from this special order. Operating Income/Loss
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