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Bramble Corporation has the excess manufacturing capacity to fill a special order from Nash, Inc. Using Bramble's normal costing process, variable costs of the special order would be $27,700 and fixed costs would be $39,400. Of the fixed costs, $8,700 would be for unavoidable overhead costs, and the remainder for rent on a special machine needed to complete the order.
Problem 1: What price can Bramble quote to Nash given this situation?
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