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Deivo Company produces a single product The coit of producing and solling a single unt of thin preduct at the companys normal activity level of
Deivo Company produces a single product The coit of producing and solling a single unt of thin preduct at the companys normal activity level of 91,200 units per year is: The normal seitong price is $1800 per unit. The company/s capocity is 103.200 units per yeat. An order has been recelved from a masorder house for 1,000 units at a special price of $15,00 per unit. This order would not affect regufar sales or the campany's totai fored cots: Aequired: 1. What is the financial advantage (disadvantage) of accepting the special order? 2. As a separate matter from the special ordet, assume the company's imenscry inciudes 1000 units of this product that were produced last year and that are inferioe to the current model. The units must be sold theough regular channels at reduced prices. The company does not expect the seling of these infenor units fo have any effect on the sales of iss current model What unit cost is relevant for estotahying a mininum selling price for the intenor units? Complete this question by entering your answers in the tabs below
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