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Question - Clay Co. has considerable excess manufacturing capacity. A special job order's cost sheet includes the following applied manufacturing overhead costs:
Fixed costs P21,000
Variable costs P33,000
The fixed costs include a normal P3,700 allocation for in-house design costs, although no in-house design will be done. Instead the job will require the use of external designers costing P7,750. What is the total amount to be included in the calculation to determine the minimum acceptable price for the job?
a. 36,700
b. 58,050
c. 40,750
d. 54,000
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