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Helix Company has been approached by a new customer to provide 2 , 0 0 0 units of its regular product at a special price
Helix Company has been approached by a new customer to provide units of its regular product at a special price of $ per unit. The regular selling price of the product is $ per unit. Helix is operating at of its capacity of units. Identify whether the following costs are relevant to Helix's decision as to whether to accept the order at the special selling price. No additional fixed manufacturing overhead will be incurred because of this order. The only additional selling expense on this order will be a $ per unit shipping cost. There will be no additional administrative expenses because of this order. Place an in the appropriate column to identify whether the cost is relevant or irrelevant to accepting this order.
Item
a Selling price $ per unit
Relevant
Not Relevant
b Direct materials cost of $ per unit
c Direct labor of $ per unit
d Variable manufacturing overhead of $ per unit
e Fixed manufacturing overhead of $ per unit
f Regular selling expenses of $ per unit
g Additional selling expenses of $ per unit
h Administrative expenses of $ per unit
i Regular selling price of $ per unit
Refer to the data in QS Based on financial considerations alone, should Helix accept this order at the special price? Explain and show your calculations.
Refer to QS and QS What nonfinancial factors should Helix consider before accepting this order? Explain.
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