Stuart Concrete Company pours concrete slabs for single-family dwellings. Lancing Construction Company, which operates outside...
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Stuart Concrete Company pours concrete slabs for single-family dwellings. Lancing Construction Company, which operates outside Stuarts normal sales territory, asks Stuart to pour 43 slabs for Lancings new development of homes. Stuart has the capacity to build 410 slabs and is presently working on 230 of them. Lancing is willing to pay only $2,600 per slab. Stuart estimates the cost of a typical job to include unit-level materials, $870; unit-level labor, $560; and an allocated portion of facility-level overhead, $1,260.
Required: Calculate the contribution to profit from the special order. Should Stuart accept or reject the special order to pour 43 slabs for $2,600 each?
Contribution to Profit = ______
Accept or Reject? _______
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