Manning co manufactures and sells trophies for winners of, Ask an Expert

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Manning Co. manufactures and sells trophies for winners of athletic and other events. Its manufacturing plant has the capacity to produce 18,000 trophies each month; current monthly production is 15,300 trophies. The company normally charges $141 per trophy. Cost data for the current level of production are shown below:

Variable costs:
Direct materials.....$ 948,600
Direct labor.......$ 290,700
Selling and administrative,....$ 41,300
Fixed coasts:
Manufacturing ......$579,870
Selling and administrative.... $134,640

The company has just received a special one-time order for 900 trophies at $73 each. For this particular order, no variable selling and administrative costs would be incurred. This order would also have no effect on fixed costs.

Required: Should the company accept this special order? Why

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9967171

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