Toshiba Inc
Subject:AccountingPrice:2.84 Bought6
Toshiba Inc. makes and sells standard television sets. Each television regularly sells for $200. The following cost data per television are based on a full capacity of 12,000 televisions produced each period: on Direct materials Direct labor Manufacturing overhead (75% variable, 25% unavoidable fixed). $75 $55 $48 A special order has been received by Farnsworth for a sale of 2,500 televisions to an overseas customer. The only selling costs that would be incurred on this order would be $10 per television for shipping. Farnsworth is now selling 7.200 televisions through regular distributors each period. What is the minimum selling price per television when negotiating a price for this special order? O A. $200 B. $188 O C. $166 D. $176
Purchase A New Answer
Custom new solution created by our subject matter experts
GET A QUOTE
Answer Preview
Minimum selling price for special order:
Direct material $75
+Direct labor $55
+Manufacturing o/h (variable) $36
+shipping cost $10
Total cost $ 176
Option d is correct.
Fixed cost or unavoidable cost shall be excluded as it anyway will be incurred whether special order is accepted or not.
