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Marcotti Cupcakes bakes and sells a basic cupcake for $1.25. The cost of producing 600,000 cupcakes in the prior year was: Revenues $750,000 Direct materials
Marcotti Cupcakes bakes and sells a basic cupcake for $1.25. The cost of producing 600,000 cupcakes in the prior year was: Revenues $750,000 Direct materials 330,000 Direct labor 66,000 Manufacturing overhead (fixed) 131,000 Manufacturing overhead (variable) 78,000 At the start of the current year, Marcotti received a special order for 15,000 cupcakes to be sold for $1.10 per cupcake. To complete the order, the company must incur an additional 5700 in total fixed costs to lease a special machine hat will stamp the cupcakes with the customer's logo. This order will not affect any of Marcotti's other operations and it has excess capacity to fulfill the contract. Should the company accept the special order? profit will by
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