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ACCTG211 Class handout 12/5/23 E23.2 Crane Company produces golf discs which it normally sells to retailers for $7 each. The cost of manufacturing 16,700
ACCTG211 Class handout 12/5/23 E23.2 Crane Company produces golf discs which it normally sells to retailers for $7 each. The cost of manufacturing 16,700 golf discs is: Materials Labor Variable overhead Fixed overhead Total $ 8,350 24,883 17,702 32,899 $83,834 Crane also incurs 6% sales commission ($0.42) on each disc sold. McGee Corporation offers Crane $4.80 per disc for 5,100 discs. McGee would sell the discs under its own brand name in foreign markets not yet served by Crane. If Crane accepts the offer, it will incur a one-time fixed cost of $5,880 due to the rental of an imprinting machine. No sales commission will result from the special order. a. Prepare an incremental analysis for the special order. b. Should Crane accept the special order?
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