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Swan Manufacturing is approached by a customer to fulfill a one-time-only special order for a product similar to one offered to domestic customers. The following
Swan Manufacturing is approached by a customer to fulfill a one-time-only special order for a product similar to one offered to domestic customers. The following per unit data apply for sales to regular customers: Direct materials$1,825 Direct labor900 Variable manufacturing support1,300 Fixed manufacturing support3,000 Total manufacturing costs$7,025.00 Markup (50%)3,512.50 Targeted selling price$ 10,537.50 Swan Manufacturing has excess capacity. Required: a.What is the full cost of the product per unit if the marketing costs is $3,000? b.What is the contribution margin per unit? c.Which costs are relevant for making the decision regarding this one-time-only special order? Why? d.For Swan Manufacturing, what is the minimum acceptable price of this one-time-only special order? e.For this one-time-only special order, should Parker and Spitzer Manufacturing consider a price of $5,400 per unit? Why or why not
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