Reference no: EM133143475
Question - Kim Exporters, LTD produces wall mounts for flat panel television sets.
The company just received a special order from Rakesh offering to buy 2,500 wall mounts for $29 per unit. Rakesh requires all 2,500 units to come from the same supplier (i.e., he cannot purchase less than 2,500 units).
The current, normal sales price per unit is $46. Variable costs to produce are $26. Total Fixed costs are $216,000.
Kim Exporters has capacity of 24,000 units. Before the special order, its sales manager Kim estimated that she would be able to sell 22,000 units to existing customers.
Via a financial perspective, Kim feels she must decline the offer.
But, she would like to counter Rakesh's offer with a different selling price.
Required - Assuming a financial perspective, what is the lowest price per unit that Kim Exporters, LTD would be willing to accept for these 2,500 units from Rakesh?
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