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Thornton Company manufactures a personal computer designed for use in schools and markets it under its own label. Thornton has the capacity to produce 3
Thornton Company manufactures a personal computer designed for use in schools and markets it under its own label. Thornton has the capacity to produce units a year but is currently producing and selling only units a year. The computer's normal selling price is $ per unit with no volume discounts. The unitlevel costs of the computer's production are $ for direct materials, $ for direct labor, and $ for indirect unitlevel manufacturing costs. The total product and facilitylevel costs incurred by Thornton during the year are expected to be $ and $ respectively. Assume that Thornton receives a special order to produce and sell computers at $ each.
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Calculate the contribution to profit from the special order. Should Thornton accept or reject the special order?
tableContribution to profitShould Thornton accept or reject the special order?
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