Moravian College Operations And Supply Chain Management Assignment Help - 85% of productive

Question - Power Serve Company expects to operate at 85% of productive capacity during April. The total
manufacturing costs for April for the production of 30,000 batteries are budgeted as follows:
Direct materials ……………………………. $285,000
Direct labor …………………………………. 104,000
Variable factory overhead …………………… 31,000
Fixed factory overhead ……………………… 58,000
Total manufacturing costs …………………. $478,000
The company has an opportunity to submit a bid for 2,000 batteries ...Read More to be delivered by April 30 to a
government agency. If the contract is obtained, it is anticipated that the additional activity will not
interfere with normal production during April or increase the selling or administrative expenses. What
is the unit cost below which Power Serve Company should not go in bidding on the government
contract? ...Read Less

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