Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

ABC Sdn Bhd manufactures Product 123. The company had been approached by DEF Sdn Bhd for a one-time only special order. The company has a

ABC Sdn Bhd manufactures Product 123. The company had been approached by DEF Sdn Bhd for a one-time only special order. The company has a policy of quoting prices on the basis of marginal cost plus 50 per cent of cost as a profit margin. Currently the company only utilises 70% of its capacity and has enough excess capacity to supply to DEF Sdn Bhd if this order is accepted. The cost to produce one unit of Product 123 is: direct material RM150; direct labour RM20; variable manufacturing overhead RM30; fixed manufacturing overhead RM30.

If DEF Sdn Bhd wants to sign a long-term contract with ABC Sdn Bhd for the supply of Product 123, the price that would most likely be quoted by ABC Sdn Bhd is RM___.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Advanced Accounting

Authors: Susan Hamlen

5th Edition

1618534246, 9781618534248

More Books

Students also viewed these Accounting questions

Question

=+b) In which application is a larger length used?

Answered: 1 week ago