(Answered) The abc company has an annual plant capacity of 25000 units

Finance

The ABC Company has an annual plant capacity of 25,000 units. Predicted data on sales and costs are given below:

Sales (20,000 units @$50) $1,000,000.00

Manufacturing Costs:

Variable $40per unit

Fixed $30,000.00

SGA

Variable (sales commission) $2.00per unit

Fixed $7,000.

A special order has been received from outside for 4,000 units at a selling price of $45 each. This order will have no effect on regular sales. The usual sales commiss ion on this order will be reduced by one half. Should the company accept the order?

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