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Problem 12-18 (Part 2) Relevant Cost Analysis in a variety of Situations (LO12-2, LO12-3, LO12-4] Andretti Company has a single product called a Dak. The
Problem 12-18 (Part 2) Relevant Cost Analysis in a variety of Situations (LO12-2, LO12-3, LO12-4] Andretti Company has a single product called a Dak. The company normally produces and sells 86,000 Daks each year at a selling price of $54 per unit. The company's unit costs at this level of activity are given below: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expenses Fixed selling expenses Total cost per unit $ 7.50 12.00 2.20 3.00 ($258,000 total) 4.70 4.00 ($344,000 total) $33.40 A number of questions relating to the production and sale of Daks follow. Each question is independent. Required: 2. Assume again that Andretti Company has sufficient capacity to produce 116,100 Daks each year. A customer in a foreign market wants to purchase 30,100 Daks. If Andretti accepts this order it would have to pay import duties on the Daks of $2.70 per unit and an additional $27,090 for permits and licenses. The only selling costs that would be associated with the order would be $1.50 per unit shipping cost. What is the break-even price per unit on this order? Reg 2 Assume again that Andretti Company has sufficient capacity to produce 116,100 Daks each year. A customer in a foreign market wants to purchase 30,100 Daks. If Andretti accepts this order it would have to pay import duties on the Daks of $2.70 per unit and an additional $27,090 for permits and licenses. The only selling costs that would be associated with the order would be $1.50 per unit shipping cost. What is the break-even price per unit on this order? (Round your answers to 2 decimal places.) Show less A Break-even price per unit
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