Question
Atlanta Manufacturers Inc. is approached by a potential new customer to fulfill a one-time-only special order for a product similar to one offered to domestic
Atlanta Manufacturers Inc. is approached by a potential new customer to fulfill a one-time-only special order for a product similar to one offered to domestic customers. The company has excess capacity. The following per unit data apply for sales to regular customers:
Variable costs:
Direct materials $170
Direct labor 90
Manufacturing support 135
Marketing costs 85
Fixed costs:
Manufacturing support 145
Marketing costs 75
Total costs 700
Markup (40%) 280
Targeted selling price $980
What is the contribution margin per unit?
Question 7 options:
| $280 |
| $220 |
| $500 |
| $700 |
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