What will be real effect on profit if the order is accepted

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Question - Accustart Metal Works received an offer from a big-box retail company to purchase 2,880 metal outdoor tables for $208 each. Accustart Metal Works accountants determine that the following costs apply to the tables:

Direct material $124

Direct labor 48

Manufacturing overhead 67

Total $239

Of the $67 of overhead, $13 is variable and $54 relates to fixed costs. The $54 of fixed overhead is allocated as $1.06 per direct labor dollar.

Required - What will be the real effect on profit if the order is accepted?

Reference no: EM133014986

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