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Given the following data for Tan Company Sales (in units) 60,000 Selling price per unit 28 Manufacturing costs per unit: Materials 5 Direct labor 4

Given the following data for Tan Company

Sales (in units) 60,000

Selling price per unit 28

Manufacturing costs per unit:

Materials 5

Direct labor 4

Overhead

Variable 4

Fixed 10

Total 23

Gross margin 5

Selling and admin. Expenses per unit 2

Operating income 3

A Company in a foregin market offer to buy and the offer specifies the following data

Units to be sold 10,000

Price per unit 13.10

What is the logical decision about this special offer

  1. Do not reject the special offer

  2. Reject the special offer

  3. Indifferent to reaction, not the special offer

  4. Always accept the offer

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