Exercise $6-9$B Using the contribution margin approach for a special order decision

Benton Company produces and sells a food processor that it prices at a $32$ percent markup on total

cost$.$ Based on data pertaining to producing and selling $50,000$ food processors, Benton computes the

sales price per food processor as follows.

Required

a$.$ Benton receives a special order for $7,000$ food processors for $$20$ each. Benton has excess capacity.

Calculate the contribution margin per unit for the special order. Based on the contribution margin

per unit, should Benton accept the special order?

b$.$ Support your answer by preparing a contribution margin income statement for the special order.Exercise $6-7$B Special order decision

Wilcox Automotive Company manufactures an engine designed for motorcycles and markets the prod$-$

uct using its own brand name. Although Wilcox has the capacity to produce $50,000$ engines annually,

it currently produces and sells only $30,000$ units per year. The engine normally sells for $$540$ per unit,

with no quantity discounts. The unit$-$level costs to produce the engine are $$192$ for direct materials,

$$180$ for direct labor, and $$36$ for indirect manufacturing costs. Wilcox expects total annual