What is the minimum acceptable selling price for the units

Reference no: EM132816081

Davis Kitchen Supply produces stoves for commercial kitchens. The costs to manufacture and market the stoves at the company's normal volume of 6,000 units per month are shown in the following table.

Unit manufacturing costs

Variable materials$51
Variable labor 76
Variable overhead 26
Fixed overhead 61
Total unit manufacturing costs $214
Unit marketing costs
Variable 26
Fixed 71
Total unit marketing costs 97
Total unit costs $311

Problem a. An inventory of 460 units of an obsolete model of the stove remains in the stockroom. These must be sold through regular channels (thus incurring variable marketing costs) at reduced prices or the inventory will soon be valueless. What is the minimum acceptable selling price for these units?

Reference no: EM132816081

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