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Rooney Company manufactures a personal computer designed for use in schools and markets it under its own label. Rooney has the capacity to produce 33,000
Rooney Company manufactures a personal computer designed for use in schools and markets it under its own label. Rooney has the capacity to produce 33,000 units a year but is currently producing and selling only 11,000 units a year. The computer's normal selling price is $1660 per unitwith no volume discounts. The unit-level costs of the computer's production are $450 for direct materials, $300 for direct labor. and $200 for indirect unit-level manufacturing costs. The total product- and facility-level costs incurred by Rooney during the year are expected to be $2,260,000 and $807,000, respectively. Assume that Rooney receives a special order to produce and sell 3.050 computers at $1.270 each. Required Calculate the contribution to prot from the special order. Should Rooney accept or reject the special order? Contribution to prot Should Rooney accept or reject the special order
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