Question
Franklin Concrete Company pours concrete slabs for single-family dwellings. Lancing Construction Company, which operates outside Franklins normal sales territory, asks Franklin to pour 48 slabs
Franklin Concrete Company pours concrete slabs for single-family dwellings. Lancing Construction Company, which operates outside Franklins normal sales territory, asks Franklin to pour 48 slabs for Lancings new development of homes. Franklin has the capacity to build 480 slabs and is presently working on 250 of them. Lancing is willing to pay only $2,510 per slab. Franklin estimates the cost of a typical job to include unit-level materials, $940; unit-level labor, $560; and an allocated portion of facility-level overhead, $1,050. Required Calculate the contribution to profit from the special order. Should Franklin accept or reject the special order to pour 48 slabs for $2,510 each?
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