Delta Company produces a single product. The cost of producing and selling a single unit...
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Accounting
Delta Company produces a single product. The cost of producing and selling a single unit of this product at the companys normal activity level of 60,000 units per year is:
Direct materials $ 10.00
Direct labor $ 3.00
Variable manufacturing overhead $ 2.00
Fixed manufacturing overhead $ 4.00
Variable selling and administrative expense $ 2.50
Fixed selling and administrative expense $ 2.40
The normal selling price is $25 per unit. The companys capacity is 75,000 units per year. An order has been received from a mail-order house for 10,000 units. What is the minimum price that should be charged per unit for this special order?
a $25
b $23.90
c $15
d $17.50
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