Reference no: EM132963150
Question - The Amazing Candy Company manufactures candy that is sold to food distributors. The company produces at full capacity for six months each year to meet peak demand during the? "candy season" from Halloween through? Valentine's Day. During the other six months of the? year, the manufacturing facility operates at? 75% of capacity. The Amazing Candy Company provides the following data for the? year:
Data Table
Cases of candy produced and sold 1,900,000 cases
Sales price $40.00 per case
Variable manufacturing costs 22.00 per case
Fixed manufacturing costs 6,900,000 per year
Variable selling and administrative costs 3.00 per case
Fixed selling and administrative costs 3,100,000 per year
The Amazing Candy Company receives an offer to produce 6000 cases of candy for a special event. This is a? one-time opportunity during a period when the company has excess capacity. What is the minimum selling price The Amazing Candy Company should accept for the? order? Explain why.
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