Holiday Decorations Unique has been approached by the community college to make special decorations for the...

 

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Holiday Decorations Unique has been approached by the community college to make special decorations for the faculty and staff. The college is willing to buy 5,000 Christmas ornaments with their own design for $6.00 each. The company normally sells its decorations for $12.00 each. A break down of their costs is as follows: Direct Materials Direct Labor Variable Costs Fixed Costs Total Cost Per Unit $2.00 50 1.50 2.50 $6.50 Should Holiday Decorations Unique accept the special order made by the college? The company has enough excess capacity to make this order. Holiday Decorations Unique has been approached by the community college to make special decorations for the faculty and staff. The college is willing to buy 5,000 Christmas ornaments with their own design for $6.00 each. The company normally sells its decorations for $12.00 each. A break down of their costs is as follows: Direct Materials Direct Labor Variable Costs Fixed Costs Total Cost Per Unit $2.00 50 1.50 2.50 $6.50 Should Holiday Decorations Unique accept the special order made by the college? The company has enough excess capacity to make this order. Holiday Decorations Unique has been approached by the community college to make special decorations for the faculty and staff. The college is willing to buy 5,000 Christmas ornaments with their own design for $6.00 each. The company normally sells its decorations for $12.00 each. A break down of their costs is as follows: Direct Materials Direct Labor Variable Costs Fixed Costs Total Cost Per Unit $2.00 50 1.50 2.50 $6.50 Should Holiday Decorations Unique accept the special order made by the college? The company has enough excess capacity to make this order. Holiday Decorations Unique has been approached by the community college to make special decorations for the faculty and staff. The college is willing to buy 5,000 Christmas ornaments with their own design for $6.00 each. The company normally sells its decorations for $12.00 each. A break down of their costs is as follows: Direct Materials Direct Labor Variable Costs Fixed Costs Total Cost Per Unit $2.00 50 1.50 2.50 $6.50 Should Holiday Decorations Unique accept the special order made by the college? The company has enough excess capacity to make this order.

Answer rating: 100% (QA)

Solution Differential revenue when order is accepted 5000 6 Differential revenue when orde... View the full answer