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Andretti Company has a single product called a Dak. The company normally produces and sells 78,000 Daks each year at a selling price of $48
Andretti Company has a single product called a Dak. The company normally produces and sells 78,000 Daks each year at a selling price of $48 per unit. The company's unit costs at this level of activity are given below: Direct materials $8.90 Direct labor 9.00 Variable manufacturing overhead 2.10 Fixed manufacturing overhead 5.00 ($390,000 total) Variable selling expenses 1.50 Fixed selling expenses 6.60 ($514,800 total) Total cost per unit $33.10 Assume again that Andretti Company has sufficient capacity to produce 97,500 Daks each year. A customer in a foreign market wants to purchase 14,500 Daks. Import duties on the Daks would be $1.30 per unit, and costs for permits and licenses would be $10,000. The only selling costs that would be associated with the order would be $1.00 per unit shipping cost. Compute the per unit break-even price on this order
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