follows: $22 $1 $2.7 The normal selling price of the product is $67.80 per unit.

Question

follows: $22 $1 $2.7 The normal selling price of the product is $67.80 per unit. An order has been received from an overseas customer for 3,000 units to be delivered this month at a special discounted price. This order would not change the total amount of the company's fxed costs. The variable selling and administrative expense would be $1.90 less per unit on this order than on normal sales Direct labor is a variable cost in this company Question 1 of0 Suppose there is ample idle capacity to produce the units required by the overseas customer and the special discounted price on the special order is $80.60 per unit. The monthly financial advantage (disadvantage) for the company as a result of accepting this special order should be: OA ($4,200) OB. $84,300 O c. ($15,900) OD. $27,300 Mark for ReviewWhat's This?

Explanation / Answer

Monthly financial advantage would be B. $84,300.

Note: there are multiple questions I have answered first question.

1) Particulars Per Unit 3000 unit Relevant Revenue (a) $             61 $     181,800 Less: Direct Material $             23 $        67,500 Direct labour $               8 $        22,500 Variable Manufacturing Overhead $               2 $          5,100 Variable Selling overhead (2.7-1.9) $               1 $          2,400 Relevant cost $             33 $        97,500 Gain /(Loss) by accepting order (a-b) $        84,300

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