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What will be real effect on profit for expresso metal work

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Reference no: EM132950279

Expresso Metal Works received an offer from a big-box retail company to purchase 3,660 metal outdoor tables for $260 each. Espresso Metal Works accountants determine that the following costs apply to the tables:

Direct Material $163
Direct Labor $61
Manufacturing overhead $86
Total $310

Of the $86 overhead, $17 is variable and $69 relates to fixed costs. The $69 of fixed overhead is allocated as $1.32 per direct labor dollar.

Problem (a) what will be the real effect on profit if the order is accepted?

Reference no: EM132950279

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