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geniusboy [140]
4 years ago
11

The following information relates to a product produced by Marigold Company: Direct materials $20 Direct labor 10 Variable overh

ead 20 Fixed overhead 15 Unit cost $65 Fixed selling costs are $650,000 per year, and variable selling costs are $10 per unit sold. Although production capacity is 400,000 units per year, the company expects to produce only 250,000 units next year. The product normally sells for $100 each. A customer has offered to buy 40,000 units for $80 each. The incremental cost per unit associated with the special order is:
Business
1 answer:
Tomtit [17]4 years ago
6 0

Answer:

The incremental cost per unit associated with the special order is $60.

Explanation:

Direct materials                                               20

Direct labor                                                       10

Variable overhead                                           20

Variable selling and administrative                 10  

Total                                                                  60

Therefore, The incremental cost per unit associated with the special order is $60.

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