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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 18.000 medals each month;
Kneller Company manufactures and sells medals for winners of athletic and other events. Its manufacturing plant has the capacity to produce 18.000 medals each month; current monthly production is 10.000 medals. The company normally charges $109 per medal. Cost data for the current level of production are shown below. Variable costs: Direct materials $ 528,400 Direct labor $ 169,100 Selling and administrative $ 27,400 Fixed costs! Manufacturing $ 158, 100 Selling and administrative $ 86,500 The company has just received a special one-time order for 500 medals at $94 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? O Accepted Not accepted
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