How many units of regular sales could be lost

Reference no: EM131763553

Question: The Young Company has gathered the following information for a unit of its most popular product:


Direct materials	$	12
Direct labor		6
Overhead (40% variable)		20
Cost to manufacture		38
Desired markup (50%)		19
Target selling price	$	57

The above cost information is based on 11,400 units. A distributor has offered to buy 3,100 units at a price of $39 per unit. The distributor claims this special order would not disturb regular sales at $57. Special packaging and other selling expenses would be an additional $0.50 per unit for the special order. How many units of regular sales could be lost before this contract is not profitable?

A) 1,250 units.

B) 3,100 units.

C) 0 units.

D) 1,550 units.

Reference no: EM131763553

Questions Cloud

Discuss risk balance or policy that senior management plays : Discuss the risk balance or policy that senior management plays for a risky project. Discuss a current project that has appeared in the news media.

What is boomer tax basis in sooner stock after distribution : This year, Sooner Company reports current E&P of negative $322,000. Its accumulated E&P at the beginning of the year was $260,000.

Same after-tax return : What interest rate on a 7-year corporate bond of equal risk would provide you with the same after-tax return? (Round your final answer to two decimal places.)

Prepare a journal entry to properly dispose of any balance : Prepare a journal entry to properly dispose of any balance in the Manufacturing Overhead account

How many units of regular sales could be lost : The above cost information is based on 11,400 units. A distributor has offered to buy 3,100 units at a price of $39 per unit.

What expectations are presented in the policy : Describe the firm's Corporate Ethics and Corporate Social Responsibility Policy. What expectations are presented in the policy?

What are the expected returns on the us and brazil : a. What are the expected returns on the US and Brazil (in percent)? b. What are the volatilities (standard deviations) of the returns on the US and Brazil.

What would happen if the population was left unattended : What would happen if the population was left unattended and not managed properly?Identify the characteristics of the selected special population.

What is the cost of goods sold in given operation : Youngstown Rubber reports the following data for its first year of operation. Direct materials used= $711,000 Cost of goods manufactured= $680,600.

User Account

All Pages