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The company has been approached by a customer with a request for a 100-unit special order. What is the minimum per unit sales price that management would accept for this order if the company wishes to increase current profits

Respuesta :

lavanyaande

The company should fix the price per unit as $9 to increase current profits.

Explanation:

Given:

Sales price= $34

Direct materials= $2

Direct labor= $3

Variable overhead= $4

Fixed overhead= $5

The company is capable of producing 5000 units with 80% operating capacity.

5000/0.80-5000=1250 units

Incremental cost= $2+$3+$4

                             = $9

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