After several years producing and selling at a capacity of 50,000 units, Milton Company faced a...
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After several years producing and selling at a capacity of 50,000 units, Milton Company faced a year with projected sales and production of 38,000 units. A potential customer offered to purchase 7,000 units at a price of P18 each. The normal sales price is P30 each. Direct material Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total P9.00 6.50 2.00 3.75 P21.25 Should Milton accept the order? Justify your answer. After several years producing and selling at a capacity of 50,000 units, Milton Company faced a year with projected sales and production of 38,000 units. A potential customer offered to purchase 7,000 units at a price of P18 each. The normal sales price is P30 each. Direct material Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total P9.00 6.50 2.00 3.75 P21.25 Should Milton accept the order? Justify your answer.
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