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Requirement 1: Gallerani receid a COSt iS $26.95. determined as follcnvs: $26.95 Landor Carpzration makes and sells electric fans, Each fan regularty sells for
Requirement 1: Gallerani receid a COSt iS $26.95. determined as follcnvs: $26.95 Landor Carpzration makes and sells electric fans, Each fan regularty sells for S38. The following cost data per fan is based on a a of 5.100 8.es 7_1S LMits of ABO fM 527.30 each Pmduct Lmit ct Direct labor Variable ram'facturing unit overhead that labor is a cost The have no on company total manufuturing costs, The customer like modifications made to product A90 that increase the variable costs by S370 per and that would require an investment of S26,OOO in special molds that vould nave no salvage value This special order mule nave no effect on the Companyg Other The company has ample Spare Capacity for producing the The annual financial advantage (disadvantage) for the company as a result of accepting this should Requirement 2: full capacity of 153000 fans produced each period. Direct labor Manufac t ng (sox d SOX unavoidable fixed) A Special order has been received by Landor a Sale Of 25,000 fans to an customer_ The only Selling COStS that Would be this be SO fM Landor is 128,003 far regular ch Assume that direct labor is an avoidable cost this decision, What should use as a minimum selling price per fan in negotiating a for this special order?
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