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Baird Company manufactures a personal computer designed for use in schools and markets it under its own label. Baird has the capacity to produce 36,000
Baird Company manufactures a personal computer designed for use in schools and markets it under its own label. Baird has the capacity to produce 36,000 units a year but is currently producing and selling only 11,000 units a year. The computers normal selling price is $1,780 per unit with no volume discounts. The unit-level costs of the computer's production are $410 for direct materials, $130 for direct labor, and $150 for indirect unit-level manufacturing costs. The total product- and facility-level costs incurred by Baird during the year are expected to be $2,140,000 and $815,000, respectively. Assume that Baird receives a special order to produce and sell 3,160 computers at $1,210 each. Required Calculate the contribution to profit from the special order. Should Baird accept or reject the special order? Contribution to profit Should Baird accept or reject the special order
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