Question
Walton Concrete Company pours concrete slabs for single-family dwellings. Lancing Construction Company, which operates outside Waltons normal sales territory, asks Walton to pour 47 slabs
Walton Concrete Company pours concrete slabs for single-family dwellings. Lancing Construction Company, which operates outside Waltons normal sales territory, asks Walton to pour 47 slabs for Lancings new development of homes. Walton has the capacity to build 430 slabs and is presently working on 110 of them. Lancing is willing to pay only $2,600 per slab. Walton estimates the cost of a typical job to include unit-level materials, $880; unit-level labor, $560; and an allocated portion of facility-level overhead, $1,220.
Required Calculate the contribution to profit from the special order. Should Walton accept or reject the special order to pour 47 slabs for $2,600 each?
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