Greenland Sports, Inc. has been asked to submit a bid to the National Hockey League on supplying
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Question:
Greenland Sports, Inc. has been asked to submit a bid to the National Hockey League on supplying 1,000 pairs of professional quality skates. The cost per pair of skates has been determined as follows:
Direct materials | $ | 80 |
Direct labor | 60 | |
Variable overhead | 30 | |
Fixed overhead (allocated) | 20 | |
Other non-manufacturing costs associated with each pair of skates are:
Variable selling cost (commission) | $ | 25 |
Fixed selling and administrative cost | 10 | |
Assume the commission on the sale of skates to the National Hockey League would be reduced to $15 per pair and that available production capacity exists to produce the 1,000 pairs of skates, the lowest price the firm can bid is some price greater than:
A) $185.
B) $190.
C) $215.
D) $225.
Related Book For
Financial and Managerial Accounting the basis for business decisions
ISBN: 978-0078111044
16th edition
Authors: Jan Williams, Susan Haka, Mark Bettner, Joseph Carcello
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