Imperial Jewelers manufactures and sells a gold bracelet for $$189\mathrm{.}95.$ The company's accounting system says the unit product cost for

this bracelet is $$149\mathrm{.}00,$ as shown below:

Direct materials

Direct labor

Manufacturing overhead

Unit product cost

A wedding party has approached Imperial Jewelers about buying $20$ gold bracelets for the discounted price of $$169\mathrm{.}95$ each. The

wedding party would like special filigree applied to the bracelets that would increase the direct materials cost per bracelet by $$2\mathrm{.}00$

Imperial Jewelers would have to buy a special tool for $$250$ to apply the filigree to the bracelets. The special tool would have no othe

use once the special order is completed.

To analyze this special order, Imperial Jewelers determined most of its manufacturing overhead is fixed and unaffected by variations in

how much jewelry is produced in any given period. However, $$4\mathrm{.}00$ of the overhead is variable with respect to the number of broce

produced. The company also believes accepting this order would hav' order using existing manufacturing capacity

Required:

What is the financial advantage $($disadvantage$)$ of accepting the wedding party's

Should the company accept the special order?

complete this question by entering your answers in the tabs below.

Required $1$ Required $2$

What is the financial advantage $($disadvantage$)$ of accepting the wedding party's special order?