Landor Appliance Company makes and sells electric fans. Each fan regularly sells

Question

Landor Appliance Company makes and sells electric fans. Each fan regularly sells for $42. The following cost data per fan is based on a full capacity of 150,000 fans produced each period. Direct material cost per unit......................................... Direct labor cost per unit Manufacturing overhead cost per unit (70% variable and 30% unavoidable fixed) 8.00 9.00 10.00 $ $ A special order has been received by Landor for a sale of 25,000 fans to an overseas customer. The only selling costs that would be incurred on this order would be $4 per fan for shipping. Landor is now selling 120,000 fans through regular channels each period. What should Landor use as a minim special order? um selling price per fan in negotiating a price for this Minimum List the items to include in the calculation: selling price Minimum selling price s orde

Explanation / Answer

Minimum selling price Direct materials 8 Direct labor 9 Variable manufacturing overhead 7 Shipping costs 4 Minimum selling price 28

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