Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. a customer requested that lewelling corporation fi

A customer requested that Lewelling Corporation fill a special order, selling Lewelling 2,600 units of...

60.1K

Verified Solution

Question

Accounting

A customer requested that Lewelling Corporation fill a special order, selling Lewelling 2,600 units of Product "S47" at a price of $31 per unit. Product S47's normal unit product cost is $20.70, as follows: Assume that direct labor is a variable cost.

The special order would have no effect on Lewelling's total fixed manufacturing overhead costs.

The customer would like modifications made to Product S47 that will increase the Variable Costs by $1.80 per unit and require an investment of $16,000 in special molds that will have no salvage value. This special order would have no effect on the company's other sales because it has ample spare capacity to produce the special order.

The Annual Financial Advantage (or Disadvantage) for the company as a result of accepting this special order should be:

image \begin{tabular}{|l|r|} \hline Direct Materials & $6.20 \\ \hline Direct Labor & 3.00 \\ \hline Variable Manufacturing Overhead & 3.30 \\ \hline Fixed Manufacturing Overhead & 8.20 \\ \hline Unit Product Cost & $20.70 \\ \hline \end{tabular}

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students