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CMR Refrigeration makes a compressor part that it sells for $35 each. The cost of producing 30,000 parts in the prior year is as follows:
Direct material $230,000
Direct labor 90,000
Variable overhead 140,000
Fixed overhead 130,000
Total cost $590,000
At the first of the current year, CMR received an order for 3,000 parts from a company in Mexico. If the Mexican company is only willing to pay $27 for the part and CMR has excess capacity, should CMR accept the order? What will be the marginal profit if any? (Show your computations
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