A scented candle company in the first half of the year has manufactured an average of 48,000 units per month. It has a zero inventory policy, so it sells all of its production in the same month at a price of $54 per candle. . Your current costs are shown below: Materials $23 per variable MOD candle $8 per variable GIF candle $2 per candle The factory has the capacity to produce 60,000 candles per month and its manufacturing overhead costs are $38,400 per month A gift shop offers to buy from you 20,000 candles at a price of $40 each uan. If the order is accepted, there would be an additional packaging and shipping cost of $2200. It is requested: 

1. Determine if you should accept the order through an analysis that shows the increase or decrease in the profits you would have. 

2. IF the order were for 15,000 candles, would it be a good idea to accept it? Justify your answer with marginal analysis

Answer rating: 100% (QA)

To determine whether the company should accept the order for 20000 candles well perform a contribution margin analysis The contribution margin per uni... View the full answer