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Vernon Concrete Company pours concrete slabs for single-family dwellings. Lancing Construction Company, which operates outside Vernon's normal sales territory, asks Vernon to pour 43
Vernon Concrete Company pours concrete slabs for single-family dwellings. Lancing Construction Company, which operates outside Vernon's normal sales territory, asks Vernon to pour 43 slabs for Lancing's new development of homes. Vernon has the capacity to build 470 slabs and is presently working on 170 of them. Lancing is willing to pay only $2,560 per slab. Vernon estimates the cost of a typical job to include unit-level materials, $820; unit-level labor, $580; and an allocated portion of facility-level overhead, $1,210. Required Calculate the contribution to profit from the special order. Should Vernon accept or reject the special order to pour 43 slabs for $2,560 each? Contribution to profit Should Vernon accept or reject the special order?
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