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Custom Metal Works received an offer from a big-box retail company to purchase 2,800 metal...

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Accounting

Custom Metal Works received an offer from a big-box retail company to purchase 2,800 metal outdoor tables for $220 each. Custom Metal Works accountants determine that the following costs apply to the tables: Direct material $120 Direct labor 60 Manufacturing overhead 80 Total $260 Of the $80 of overhead, $14 is variable and $66 relates to fixed costs. The $66 of fixed overhead is allocated as $1.10 per direct labor dollar. What will be the real effect on profit if the order is accepted?

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