Exercise 11-4 (Algo) Special Order Decision (LO11-4) Imperial Jewelers manufactures and sells a gold bracelet for $403.00. The company's accounting system says that the unit product cost for this bracelet is $267.00 as shown below: Direct materials $ 145 Direct labor 86 Manufacturing overhead Unit product cont $ 267 36 The members of a wedding party have approached Imperial Jewelers about buying 23 of these gold bracelets for the discounted price of $363.00 each. The members of the wedding party would like special filgree applied to the bracelets that would increase the direct materials cost per bracelet by $4, Imperial Jewelers would also have to buy a special tool for $464 to apply the filigree to the bracelets. The special tool would have no other use once the special order is completed. To analyze this special order opportunity. Imperial Jewelers has determined that most of its manufacturing overhead is fixed and unaffected by variations in how much jewelry is produced in any given period. However, $5.00 of the overhead is variable with respect to the number or bracelets produced. The company also believes that accepting this order would have no effect on its ability to produce and sell jewelry to other customers. Furthermore, the company could fulfill the wedding party's order using its existing manufacturing capacity Required: 1. What is the financial advantage (disadvantage) of accepting the special order from the wedding party? 2. Should the company accept the special order? Complete this question by entering your answers in the tabs below. Required: Required 2 What is the financial advantage (disadvantage) of accepting the special order from the wedding party? NA Required 2 > Exercise 11-4 (Algo) Special Order Decision (L011-4] Imperial Jewelers manufactures and sells a gold bracelet for $403.00. The company's accounting system says that the unit product cost for this bracelet is $267.00 as shown below: Direct materials Direct lobor Manufacturing overhead Unit product cost $ 145 86 36 $ 267 The members of a wedding party have approached Imperial Jewelers about buying 23 of these gold bracelets for the discounted price of $363.00 each. The members of the wedding party would like special niligree applied to the bracelets that would increase the direct materials cost per bracelet by $4. Imperial Jewelers would also have to buy a special tool for $464 to apply the filigree to the bracelets. The special tool would have no other use once the special order is completed To analyze this special order opportunity, Imperial Jewelers hos determined that most of its manufacturing overhead is fixed and unaffected by variations in how much jewelry is produced in any given perlod. However , $5.00 of the overhead is variable with respect to the number of bracelets produced. The company also believes that accepting this order would have no effect on its ability to produce and sell Jewelry to other customers. Furthermore, the company could fulfill the wedding party's order using its existing manufacturing capacity Required: 1. What is the financial advantage (disadvantage of accepting the special order from the wedding party? 2. Should the company accept the special order? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Should the company accept the special order? Yes ONO
