Question
Adel & Ziad Manufacturing is approached by a European customer to fulfill a one time-only special order for its product. The following per unit data
Adel & Ziad Manufacturing is approached by a European customer to fulfill a one time-only special order for its product. The following per unit data apply for sales to regular customers:
Direct materials $66
Direct labor 30
Variable manufacturing support 48
Variable cost per unit 144
Total Fixed cost $1,000,000
Selling price $372
Adel & Ziad Manufacturing has capacity equals to 20,000 uyou knnits. European customer offered to buy 2,000 units in the special order with selling price of $340 per unit If ow that Adel & Ziad Manufacturing sells 19,000 units to regular customers. Required:
Should Adel & Ziad accept or reject the offer, and why? (Use financial and nonfinancial terms to explain why)
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