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Rooney Quilting Company makes blankets that it markets through a variety of department stores. It...

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Accounting

Rooney Quilting Company makes blankets that it markets through a variety of department stores. It makes the blankets in batches of 1,000 units. Rooney made 31,000 blankets during the prior accounting period. The cost of producing the blankets is summarized here.

Materials cost ($29 per unit 31,000)$899,000Labor cost ($22 per unit 31,000)682,000Manufacturing supplies ($6 31,000)186,000Batch-level costs (31 batches at $5,000 per batch)155,000Product-level costs300,000Facility-level costs330,000Total costs$2,552,000Cost per unit = $2,552,000 31,000 = $82.3

Required

  1. Sunny Motels has offered to buy a batch of 500 blankets for $63 each. Rooney's normal selling price is $97 per unit. Calculate the relevant cost per unit for the special order. Based on the preceding quantitative data, should Rooney accept the special order?
  2. Sunny offered to buy a batch of 1,000 blankets for $63 per unit, calculate the relevant cost per unit for the special order. Should Rooney accept the special order?

(For all requirements, round "Cost per unit" to 2 decimal places.)

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