Question: Case Regular sales of a company sells 400,000 units of irons per month. Variable cost of $40,000 per unit. Fixed cost $10,000 per unit .

Case
Regular sales of a company sells 400,000 units of irons per month.

Variable cost of $40,000 per unit.

Fixed cost $10,000 per unit . Normal selling price $500,000

The company received an offer from an exporter to produce 50,000 units of irons at a price of $400,000

If this offer is accepted, it will not interfere with the company\'s normal production and there will be no overtime

The question:
Determine the decision should the additional order be accepted?

Note: The solution shows the correct and structured calculations and is supported by a comprehensive discussion

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