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urgent Required information Self-Study Problem 11-1 (Algo) Special-Order Pricing [The following information applies to the questions displayed below] Highivolu incorporated manufactures a moderately priced set
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Required information Self-Study Problem 11-1 (Algo) Special-Order Pricing [The following information applies to the questions displayed below] Highivolu incorporated manufactures a moderately priced set of lawn furniture (a table and four chairs) that it selis for \$240. The company currently manufactures and sells 6,300 sets per year. The manufacturing costs include $88 for direct. materials and $48 for direct labor per set. The overhead charge per set is $38, which consists entirely of fixed costs Highvalu is considering a special purchase offer from a large retail firm, which has offered to buy 630 sets per year for three years at a price of $162 per set. HighValu has the avallable plant capacity to produce the order and expects no other orders or profitable alternative uses of the plant capacity. Part 1 (Algo) Required: 1. What is the total relevant cost per unit to produce the units roquested by the retail firm? 2. What is the estimated net effect on annual operating income if HighValu accepts the special sales order Step by Step Solution
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