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Problem 53 - Extra Credit Porter Manufacturers Inc. is approached by a European customer to fulfill a one-time-only special order for a product similar to
Problem 53 - Extra Credit Porter Manufacturers Inc. is approached by a European customer to fulfill a one-time-only special order for a product similar to one offered to domestic customers. The company has excess capacity. The following per unit data apply for sales to regular customers: Variable costs: Direct materials $120 Direct labor 60 Variable Mfg Overhead 105 Marketing costs 45 Fixed costs: Fixed Mfg Overhead 135 Marketing costs 45 Total costs 510 Markup (50%) 255 Targeted selling price $765 A) What is the full cost of the product per unit? B) What is the contribution margin per unit? C) What is the minimum acceptible price for the special order? D) What is the change in operating profits if the one-time-only special order for 1,000 units is accepted for $540 a unit by Conroe? Show your calculations in the space below
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