Assume that MTA Sandwiches sells sandwiches for $3.70 each. The cost of each sandwich follows:...
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Accounting
Assume that MTA Sandwiches sells sandwiches for $3.70 each. The cost of each sandwich follows: Materials $ 1.10 Labor 0.60 Variable overhead 0.40 Fixed overhead ($18,720 per month, 20,800 units per month) 0.90 Total cost per sandwich $ 3.00 One of MTA's regular customers asked the company to fill a special order of sandwiches at a selling price of $2.80 each for a fund-raising event sponsored by a social club at the local college. MTA has capacity to fill it without affecting total fixed costs for the month. MTA's general manager was concerned about selling the sandwiches below the cost of $3.00 per sandwich and has asked for your advice. Required: a. Prepare a schedule to show the impact on MTA's profits of providing 400 sandwiches in addition to the regular production and sales of 20,800 sandwiches per month. (Select option "higher" or "lower", keeping Status Quo as the base. Select "None" if there is no effect.)
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