question 38

Welch manufacturing is approached by a european customer to fulfill a one - time only special order for a product similar to one offered to domestic customers . welch manufacturing has excess capacity. the following per unit data apply for sales to regular customers:

variable costs:

direct materials $40

direct labour 20

manufacturing support 35

marketing cost 15

fixed cost:

manufacturing support 45

marketing cost 15

total costs $170

markup (50%) 85

targeted selling price $255

what is the contribution margin per unit ?

1-110

2-195

3-160

4-85

5-145