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Take a look at Project HP-HDC-32 (this is new information, not in the case). This long-term contract with a major customer involves the assembly of

Take a look at Project HP-HDC-32 (this is new information, not in the case). This long-term contract with a major customer involves the assembly of 10,000 largescale printer control boards per year for the years 2008-2012, (using Sunnyvale Line 6) The contract requires the customer to pay us $107 per board. The direct-material content is $1.32; the direct-labor content is $0.31. The processing requirements are 0.2 machine hours per board. Compute the unit and total profitability of this contract in 2008, 2009, and 2010 (you can assume that DM, DL, and processing requirements are the same in the 2008- 2010 timeframe). Comment

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