Pembroke Furniture manufactures rustic furniture.The cost accounting system estimates manufacturing costs to be $80 per table, consisting of 70% variable costs and 30% fixed costs, based on a current production level of 15,000.Total capacity is 16,000.The current selling price is $100 per unit.

The company just received a special order for 2,000 tables.This special order will be delivered to the customer as a single delivery, and will require extra shipping and storage costs of $50,000.As well, packaging costs will be reduced by $6/unit for the special order.

Required

What is the minimum selling price they should accept for this special order?

Answer rating: 100% (QA)

Opportunity cost will be for 16000 15000 1000 units Oppor... View the full answer