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Special Order: High-Low Cost Estimation ABS, Inc. produces air bag systems that it sells to North American automobile manufacturers. Although the company has a capacity
Special Order: High-Low Cost Estimation
ABS, Inc. produces air bag systems that it sells to North American automobile manufacturers. Although the company has a capacity of 150,000 units per year, it is currently producing at an annual rate of 90,000 units. ABS, Inc. has received an order from a Japanese manufacturer to purchase 30,000 units at $8.75 each. Budgeted costs for 90,000 and 120,000 units are as follows:
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