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Anglen Company manufactures and sells trophies for winners of athletic and other events. Its manufacturing...

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Accounting

Anglen Company manufactures and sells trophies for winners of athletic and other events. Its manufacturing plant has the capacity to produce 19,400 trophies each month; current monthly production is 16,080.00 trophies. The company normally charges $110.00 per trophy. Cost data for the current level of production are shown below:

Variable costs:
Direct materials $ 490,300
Direct labor $ 363,300
Selling and administrative $ 21,440
Fixed costs:
Manufacturing $ 412,340
Selling and administrative $ 77,680

The company has just received a special one-time order for 970 trophies at $50.80 each. For this particular order, no variable selling and administrative costs would be incurred. This order would also have no effect on fixed costs. Assume that direct labor is a variable cost.

Required:

Should the company accept this special order? Why?

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