Please answer question 3-44
ncing McGee Corporation ecngo. piel produces a lodule used in automobile manufacturing . dry's practical capacity is 4,000 modules per week. The top 5. 190 per module, Production this quarter is 3,000 modules per eyek and all of the modules produced are sold each week, Demand is expected to remain steady. Toul costs of production this week at the level of 3,009 modules were $300,000 of fixed costs plus $2,400,000 of variable costs. Suppose that a new customer's supplier has an emergency need for 1,500 modules to be delivered next week and that the plant cannot schedule overtime production. Consequently, McGee would have to give up some of its current sales to fill the new order. Total selling and administrative costs would not change if McGee accepts the order. Required What is the minimum (floor) price that McGee should charge for the new order? LO 2 3-44 Special order pricing Shorewood Shoes Company makes and sells a variety of leather shoes for children. For its current mix of different models and sizes, the average selling price and costs per pair of shoes are as follows: ITEM AMOUNT Price Costs 520 Direct materials Direct labor 56 Variable manufacturing overhead Variable selling costs Fixed overhead Total costs $16 Shoes are manufactured in batch sizes of 100 pairs. Each batch requires 5 machine hours to manufacture. The plant has a total capacity of 4,000 machine hours per month, but current monthly production consumes only about 80% of the capacity. A discount store has approached Shorewood to buy 10,000 pairs of shoes next month. It has requested that the shoes bear its own private label. Embossing the private label will cost Shorewood an additional $0.50 per pair. However, no variable selling costs will be incurred for fulfilling this special order. Required Determine the minimum (floor) price that Shorewood Shoes should charge for this order. What other considerations are relevant in this decision? LO2,4 3-45 Export order Berry Company produces and sells 30,000 cases of fruit preserves each year. The following information reflects a breakdown of its costs: COSTS PER CASE TOTAL COATS $-180,000 COST ITEM $16 240 0300 Variable production costs