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Problem - Newport Manufacturing makes and sells backyard fire pits. Each fire pit regularly sells for $269. The following cost data per unit are based on a full capacity of 3,000 fire pits produced each period.
Direct material $100
Direct labor $75
Manufacturing overhead (75% variable) $64
Newport is negotiating a special order for the sale of 75 fire pits to an overseas customer. The only selling cost that would be incurred on the special order would be a $10 sales commission. Newport is expected to make 2,500 fire pits before the special order.
Required: What is the minimum selling price Newport should negotiate for the special order?
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