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X Ltd. Has been approached by a customer who would like a special job to be done for him and is willing to pay Rs
X Ltd. Has been approached by a customer who would like a special job to be done for him and is willing to pay Rs 22000 for it. The job would require the following materials: (i) Material B is used regularly by X Ltd., and if stocks required for this job, they would need to be replaced to meet other production demand. (ii) Material C and D are in stock as the result of previous excess purchase and they have a restricted use. No other use could be found for material C but material D could be used in another job as substitute for 300 units of material, which currently cost Rs 5 per unit (of which the company has no units in stock at the moment). What are the relevant costs of material, in deciding whether or not to accept the contract? Assume all other expenses on this contract are to be specially incurred besides the relevant cost of material is Rs 550
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