Crackle Cellular is approached by Tingle, a new customer, to fulfill a large onetimeonly special...
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Accounting
Crackle Cellular is approached by Tingle, a new customer, to fulfill a large
onetimeonly
special order for a product similar to one offered to regular customers. Crackle Cellular has excess capacity. The following per unit data apply for sales to regular customers:
| Direct materials | $170 |
| Direct manufacturing labour | 60 |
| Variable manufacturing support | 30 |
| Fixed manufacturing support | 100 |
| Total manufacturing costs | 360 |
| Markup (30%) | 108 |
| Estimated selling price | $468 |
If Tingle wanted a
longterm
commitment for supplying this product, what price would most likely be quoted to them?
A.
$360
B.
$468
C.
$507
D.
$377
E.
$290
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