San Diego State University Operations And Supply Chain Management Assignment Help - Expenses

Question - Glade Company produces a single product. The costs of producing and selling a single unit of this
product at the company's current activity level of 7,500 units per month are:
Direct materials $ 2.50
Direct labor $ 2.00
Variable manufacturing overhead $ .50
Fixed manufacturing overhead $
4.95
Variable selling and administrative expenses $ 1.00
Fixed selling and administrative expenses $ 1.00

The normal selling price is $15.45 per unit. The company's capacity is 9,600 units per
month. An order has been received from a potential customer overseas for 2,100 units at
a price of $10.20 per unit. This order would not affect regular sales.
Required:
1.
If the order is accepted, by how much will monthly profits increase or decrea ...Read More se? (The
order would not change the company's total fixed costs.) (Input the amount as a
positive value. Omit the "$" sign in your response.)
Monthly profits would increase by??? $
2.
Assume the company has 500 units of this product left over from last year that are
inferior to the current model. The units must be sold through regular channels at
reduced prices. What unit cost is relevant for establishing a minimum selling price
for these units? (Round your answer to 2 decimal places. Omit the "$" sign in
your response.)
Relevant cost per unit $ ...Read Less

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