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Question: question 1 kitchens sales inc is approached by mr louis...

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QUESTION 

1.     Kitchens Sales Inc. is approached by Mr. Louis Cifer, a new customer, to fulfill a large one-time-only special order for a product similar to one offered to regular customers. The following per unit data apply for sales to regular customers:

 

            Direct materials                               $556

            Direct labor                                      362

            Variable manufacturing support      60

            Fixed manufacturing support          126

            Total manufacturing costs               1,104

            Markup (50%)                                 552

            Targeted selling price                      $1,656

 

Kitchens Sales Inc. has excess capacity. Mr. Cifer wants the cabinets in cherry rather than oak, so direct material costs will increase by $70 per unit. The average marketing cost of Kitchens Sales product is $173 per order.  For Kitchens, what is the full cost of the one-time-only special order?

 

   

$1034

   

$1174

   

$1104

   

$1347

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