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ta The Award One Company manufactures windows. Its manufacturing plant has the capacity to produce 20,000 windows each month. Current production and sales are 15,000
ta The Award One Company manufactures windows. Its manufacturing plant has the capacity to produce 20,000 windows each month. Current production and sales are 15,000 windows per month. The company normally charges $150 per window. Cost information for the current activity level is as follows: (Click the icon to view the cost information.) (Click the icon to view the special order information.) Read the requirements Save Requirement 1. Should Begin by completing an income with the speciali enter "0" in the appropri Data table Direct materials X alculate operating Variable costs that vary with number of units produced hange, make sure to $ 300,000 Direct manufacturing labor 150,000 Variable costs (for setups, materials handling, quality control, and so on) that vary with number of batches, 300 batches x $1,250 per batch 375,000 300,000 55,000 $ 1,180,000 Revenues Variable costs: Direct materials- Direct manufacturing Batch manufacturing P Fixed costs Fixed manufacturing costs Fixed marketing costs Total costs Print Done More info - ould Award gan analysis ecial order, a ropriate cells Award One has just received a special one-time-only order for 5,000 windows at $125 per window. Accepting the special order would not affect the company's regular business or its fixed costs. Award One makes windows for its existing customers in batch sizes of 50 windows (300 batches x 50 windows per batch = 15,000 windows). The special order requires Award One to make the windows in 100 batches of 50 windows. xt, calc ho char S cturing labort cturing costs Print Done d Award Requirements - X n analysis al order, a riate cells ring labor ring costs 1. Should Award One accept this special order? Show your calculations. 2. Suppose plant capacity were only 17,500 windows instead of 20,000 windows each month. The special order must either be taken in full or be rejected completely. Should Award One accept the special order? Show your calculations. 3. As in requirement 1, assume that monthly capacity is 20,000 windows. Award One is concerned that if it accepts the special order, its existing customers will immediately demand a price discount of $15 in the month in which the special order is being filled. They would argue that Award One's capacity costs are now being spread over more units and that existing customers should get the benefit of these lower costs. Should Award One accept the special order under these conditions? Show your calculations. xt, ca no ch thin Print Done
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