Windsor Corporation was experiencing a good year in terms of sales volume and profitability of its popular
Question:
Windsor Corporation was experiencing a good year in terms of sales volume and profitability of its popular electronic tablets. Each one sold for $300, with per unit product costs shown below. Per-Unit COGS DM $50 DL 42 Variable-MOH 22 Fixed-MOH 33 Total $147 A sales manager received a call from a potential customer who wanted a last-minute order before year-end. The customer knew the market price but offered to pay $265 per unit instead, for 50 tablets. If the customer's employees liked the tablets, it was possible the customer would return and pay full price for a second order next year. Windsor's production facility has the available capacity for this special order without reducing capacity for its regular orders. (a) in addition to the product costs show aboce, Windsor typically incurs a variable selling cost of $5 per unit. If the company accepts the special order, it will not incur this cost. Based on the available information, should Windsor take on this special order? How much better or worse off will it be if it accepts this order? Windsor accept the order. The company would be by
Cost Management A Strategic Emphasis
ISBN: 9781259917028
8th Edition
Authors: Edward Blocher, David F. Stout, Paul Juras, Steven Smith