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Kneller Company manufactures and sells medals for winners of athletic and other events. Its manufacturing plant has the capacity to produce 23.000 medals each month;

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Kneller Company manufactures and sells medals for winners of athletic and other events. Its manufacturing plant has the capacity to produce 23.000 medals each month; current monthly production is 10,000 medals. The company normally charges $106 per medal. Cost data for the current level of production are shown below: Variable costs: Direct materials $ 513,800 Direct labor $ 164,400 Selling and administrative $ 26,600 Fixed costs: Manufacturing $ 153,400 Selling and administrative $ 83,900 The company has just received a special one-time order for 500 medals at $87 each. For this particular order, no variable selling and administrative costs would be incurred. This order would also have no effect on fixed costs. Assume that direct labor is a variable cost. Required: Should the company accept this special order? Accepted Not accepted

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