Rothery co manufactures and sells medals for winners of

Reference no: EM13599103

Rothery Co. manufactures and sells medals for winners of athletic and other events. Its manufacturing plant has the capacity to produce 18,000 medals each month; current monthly production is 17,000 medals. The company normally charges $88 per medal. Cost data for the current level of production are shown below:

Variable Costs:

Direct materials.................. $493,000
Direct Labor...................... $323,000
Selling & Administrative....... $30,600
Fixed Costs:
Manufacturing.................... $340,000
Selling & Administrative....... $153,000

The company has just received a special one-time order for 600 medals at $73 each. For this particular order, no variable selling and administrative costs would be incurred. This order would also have no effect on fixed costs.
Should the company accept this special order? How much would they make or lose on the order?

Reference no: EM13599103

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Rothery co manufactures and sells medals for winners of

Reference no: EM13599103

Reference no: EM13599103

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