Question
Almond Treats manufactures various types of cereals that feature almonds. Acme Cereal Company has approached Almond Treats with a proposal to sell the company its
Almond Treats manufactures various types of cereals that feature almonds. Acme Cereal Company has approached Almond Treats with a proposal to sell the company its top selling cereal at a price of $21,662 for 20,000 pounds. The costs shown are associated with production of 20,000 pounds of almond cereal:
Costs | Amounts |
---|---|
Direct material | $13,580 |
Direct labor | 4,768 |
Manufacturing overhead | 6,756 |
The manufacturing overhead consists of $1,894 of variable costs with the balance being allocated to fixed costs. If Almond Treats buys the cereal, what is the effect on profit? If the effect is negative, use a dash - not parentheses ( ).
Zena Technology sells arc computer printers for $59 per unit. Unit product costs are:
Costs | Amounts |
---|---|
Direct materials | $14 |
Direct labor | 22 |
Manufacturing overhead | 4 |
A special order to purchase 12,282 arc printers has recently been received from another company and Zena has idle capacity to fill the order. Zena will incur an additional $3 per printer for additional labor costs due to a slight modification the buyer wants made to the original product. One-third of the manufacturing overhead costs is fixed and will be incurred no matter how many units are produced.
When negotiating the price, what is the minimum selling price per unit that Zena should accept for this special order? Round to the nearest penny, two decimal places.
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