Question
Dantley's Furniture manufactures rustic furniture. The cost accounting system estimates manufacturing costs to be $220 per table, consisting of 75% variable costs and 25% fixed
Dantley's Furniture manufactures rustic furniture. The cost accounting system estimates manufacturing costs to be $220 per table, consisting of 75% variable costs and 25% fixed costs. The company has surplus capacity available. It is Back Forrest's policy to add a 45% markup to full costs.A large hotel chain is currently expanding and has decided to decorate all new hotels using the rustic style. Dantley's Furniture Incorporated is invited to submit a bid to the hotel chain. What is the price per unit Dantley's Furniture should bid on this long-term order?
A) $168
B) $180
C) $319
D) $348
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