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Problem: Module 6 Textbook Problem 3 Learning Objective: 6-2 Make appropriate special order decisions Rundle Company manufactures a personal computer designed for use in schools
Problem: Module 6 Textbook Problem 3 Learning Objective: 6-2 Make appropriate special order decisions Rundle Company manufactures a personal computer designed for use in schools and markets it under its own label, Rundle has the capacity to produce 38,000 units a year but is currently producing and selling only 11,000 units a year. The computer's normal selling price is $1,720 per unit with no volume discounts. The unit-level costs of the computer's production are $410 for direct materials, $280 for direct labor, and $150 for indirect unit-fevel manufacturing costs. The total product-and facility-level costs incurred by Rundle during the year are expected to be $2,110,000 and $813,000, respectively. Assume that Rupdle recelves a special order to produce and sell 3,150 computers at $1,260 each. Required Calculate the contribution to profit from the special order. Should Rundle accept or reject the special order
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