What proper relevant cost in deciding to accept order

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Question - Kumander Daot, a manufacturer of computer peripherals, has excess capacity. The company's Davao plant has the following per-unit cost structure for item no. 89:

Variable manufacturing $50

Fixed manufacturing 15

Variable selling 8

Fixed selling 11

Traceable fixed administrative 4

Allocated administrative 2

The traceable fixed administrative cost was incurred at the Davao plant: in contrast, the allocated administrative cost represents a fair share of Kumander' corporate overhead. Utah has been presented with a special order of 5,000 units of item no. 89 on which no selling cost will be incurred. What the proper relevant cost in deciding whether to accept this special order?

Reference no: EM133188309

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