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Sample question with answer XYZ company has annual capacity of producing 35000 units per year. Budgeted operating results for 2020 are as follows: Sales [25,000
Sample question with answer XYZ company has annual capacity of producing 35000 units per year. Budgeted operating results for 2020 are as follows: Sales [25,000 units) $8.50 per unit Variable costs: Manufacturing $2.80 Selling $ 0.50 Fixed Cost $28,00 A wholesaler from another country wants to buy 8000 units at a price of $6 per unit. But fixed cost will increase by $1000 and Variable manufacturing costs would increase by $0.75 per unit, and selling cost cost would increase by $1.00 per unit for the special order only REQUIRED 1. Determine whether the company should produce the special order. 2. Assuming XYZ company's objective is to maximize profit , if the customer wants a special order of 15000 units , should XYZ company accept or reject special order
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