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Rundle Company manufactures a personal computer designed for use in schools and markets it under its own label. Rundle has the capacity to produce 37,000
Rundle Company manufactures a personal computer designed for use in schools and markets it under its own label. Rundle has the capacity to produce 37,000 units a year but is currently producing and selling only 15,000 units a year. The computer's normal selling price is $1,790 per unit with no volume discounts. The unitlevel costs of the computer's production are $440 for direct materials, $270 for direct labor, and $200 for indirect unitlevel manufacturing costs. The total product- and facilitylevel costs incurred by Rundle during the year are expected to be $2,160,000 and $801,000, respectively. Assume that Rundle receives a special order to produce and sell 3,070 computers at $1,300 each. Required Calculate the contribution to profit from the special order. Should Rundle accept or reject the special order? Contribution to profit $ 1,811,300 Should Rundle accept or reject the special order? Accept
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