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For the remainder of the problem..assume the following: Total estimated annual fixed costs are $367,500 and annual sales of 10,000 units are expected. The selling

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For the remainder of the problem..assume the following: Total estimated annual fixed costs are $367,500 and annual sales of 10,000 units are expected. The selling price of a unit is $73. Per-unit costs are as follows: $ 5.00 Direct materials Direct labor Manufacturing overhead: Variable Fixed Selling costs: Commissions Shipping Fixed 1.00 1.50 1.00 $ 29.50 1. How much is the unit contribution margin? 2. The company's cost formula (cost function) for annual total cost would be: 3. A special one-time order to purchase 20,000 units was recently received at a price of $60 per unit. There is enough capacity to fill the order and filling this order will NOT disrupt current operations. If the company accepts this order 1) variable manufacturing costs will be reduced by $5 per unit, and 2) variable selling costs (both commission and shipping) will go down by 80%. Should the special order be accepted or rejected, and how much better (or worse) off would the company be if they take your advice? 4. In negotiating a price in order to not hurt profits, the minimum acceptable selling price per unit would be: 5. Now assume that the company is operating AT CAPACITY and that accepting this order will displace other regularly scheduled work. Should they accept or reject this order AND how much better or worse off would the company be? accept or reject better or worse by 6. The price per unit that they could charge for this order without hurting their income is: per unit 7. Assume that the company has 2,000 units of Product A in their warehouse that are obsolete and must be sold immediately at a reduced price, otherwise, they will become worthless and will have to be thrown away. Assuming that the units must be shipped to the customer, what is the minimum total amount that they must charge for these units in order to not lose money? 8. The company has received an offer from Markoff Company who has offered to make the units AND ship the units to the company's customers for a price of $18.50 per unit. Should the company accept the outsourcing offer (yes or no) AND by how much (benefit)$ Show all computations

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