Chapter $8$ HW

eBook

component:

Selling price

$$32$

Less costs:

Direct materials

$17$

Direct labor

$7$

Variable overhead

$2$

Fixed overhead

Operating profit

$3$

Required:

Conceptual Connection: Should Steve accept the order at a selling price of $$1\mathrm{.}85$ per unit?

By how much will his division's profits be changed if the order is accepted?

By how much will the profits of Pat's division change if Steve agrees to supply the part at full cost?

If Pat accepts the price, what is the change in profits for Steve's division?

Please solve the blank questions