Question
CAT Co. is a manufacturer of industrial components. One of their products that is used as a subcomponent in auto manufacturing is KB-96. This product
CAT Co. is a manufacturer of industrial components. One of their products that is used as a subcomponent in auto manufacturing is KB-96. This product has the following financial structure per unit:
Selling price $150
Direct materials $ 20
Direct labor 15
Variable manufacturing overhead 12
Fixed manufacturing overhead 30
Shipping and handling 3
Fixed selling and administrative 10
Total costs $ 90
Q: CAT. has received a special, one-time, order for 1,000 KB-96 parts. Assuming CAT has excess capacity, the minimum price that is acceptable for this one-time special order is in excess of ?
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