Home Wood manufactures fold-up patio table. Their facility enables them to manufacture 8,000 tables per month....

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Home Wood manufactures fold-up patio table. Their facility enables them to manufacture 8,000 tables per month. These tables sell for $325 per table. The facility is currently operating at 70% capacity. Recently they were approached by a major retailer, Backyard Adventures to provide a special one-time order of 3,500 tables for $225. Backyard Adventures requests the name of the retailer be imprinted on the table and the table should be should be one foot longer and two feet wider. These changes will cost an additional $15 in materials and $5 in labour cost. Commission on the sale will be $2.50 per table. All other costs will remain the same. Home Wood current cost for manufacturing and supplying the tables to current customers are: Direct materials per unit Direct labour per unit Variable manufacturing overhead per unit Fixed manufacturing overhead per unit Commission per unit Fixed selling cost per unit Total Cost per unit $85.00 $25.00 $5.00 $1.50 $3.50 $2.00 $122.00 Should Home Wood accept the offer? What is the benefit or loss from accepting the offer? b. Identify two non-financial considerations would Home Wood should consider when determining whether or not to accept special one-time offers? Home Wood manufactures fold-up patio table. Their facility enables them to manufacture 8,000 tables per month. These tables sell for $325 per table. The facility is currently operating at 70% capacity. Recently they were approached by a major retailer, Backyard Adventures to provide a special one-time order of 3,500 tables for $225. Backyard Adventures requests the name of the retailer be imprinted on the table and the table should be should be one foot longer and two feet wider. These changes will cost an additional $15 in materials and $5 in labour cost. Commission on the sale will be $2.50 per table. All other costs will remain the same. Home Wood current cost for manufacturing and supplying the tables to current customers are: Direct materials per unit Direct labour per unit Variable manufacturing overhead per unit Fixed manufacturing overhead per unit Commission per unit Fixed selling cost per unit Total Cost per unit $85.00 $25.00 $5.00 $1.50 $3.50 $2.00 $122.00 Should Home Wood accept the offer? What is the benefit or loss from accepting the offer? b. Identify two non-financial considerations would Home Wood should consider when determining whether or not to accept special one-time offers?

Answer rating: 100% (QA)

SOLUTION a To determine whether Home Wood should accept the special onetime order from Backyard Adve... View the full answer