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please help solve (with same format shown) Pardo Company produces a single product and has capacity to produce 160,000 units per month. Costs to produce
please help solve (with same format shown)
Pardo Company produces a single product and has capacity to produce 160,000 units per month. Costs to produce its current monthly sales of 128,000 units follow. The normal selling price of the product is $122 per unit. A new customer offers to purchase 32,000 units for $64.80 per unit. If the special offer is accepted, there will be no additional fixed overhead and no additional fixed general and administrative costs. The special offer would not affect its normal sales. Direct materials Direct labor Variable overhead Fixed overhead Fixed general and administrative Totals Per Unit $ 12.50 15.00 14.00 17.50 13.00 $ 72.00 Costs at 128,000 Units 5.1,600,000 1.920,000 1,792,000 2.240,000 1,664,000 $ 9,216,000 (a) Compute the income from the special offer (b) Should the company accept the special offer? Required A Required B Compute the income for the special offer. (Round your "Per Unit" answers to 2 decimal places.) SPECIAL OFFER ANALYSIS Per Unit Total Variable costs Contribution margin Fixed costs Fixed overhead Fixed general and administrative Income Required A Required > Required A Required B Should the company accept the special offer? Should the company accept the special offer? Step by Step Solution
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