Swiss Watches Inc approaches Taiwan Watches Inc. with an inquiry about a special order. Taiwan Watches...

 

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Swiss Watches Inc approaches Taiwan Watches Inc. with an inquiry about a special order. Taiwan Watches has excess capacity. The following information per unit data is given for sales to Taiwan's regular customers: Variable costs: Direct materials Direct labour $170 70 Manufacturing support 110 Marketing costs 50 Fixed costs: Manufacturing support 100 Marketing costs 80 Total costs 580 Markup (50%) Targeted selling price 290 $870 For Taiwan Inc., what is the minimum acceptable price of this special order? Taiwan Inc. will incur no variable marketing costs for this special order. Swiss Watches Inc approaches Taiwan Watches Inc. with an inquiry about a special order. Taiwan Watches has excess capacity. The following information per unit data is given for sales to Taiwan's regular customers: Variable costs: Direct materials Direct labour $170 70 Manufacturing support 110 Marketing costs 50 Fixed costs: Manufacturing support 100 Marketing costs 80 Total costs 580 Markup (50%) Targeted selling price 290 $870 For Taiwan Inc., what is the minimum acceptable price of this special order? Taiwan Inc. will incur no variable marketing costs for this special order.