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IIA-CIA-PART3 · Question #77

A company produces water buckets with the following costs per bucket: Direct labor = 82 Direct material = $5 Fixed manufacturing = 83.50 Variable manufacturing = 82.50 The water buckets are usually…

The correct answer is A. $9.50. You've hit your session limit · resets 10:20pm (America/New_York)

Question

A company produces water buckets with the following costs per bucket:

Direct labor = 82 Direct material = $5 Fixed manufacturing = 83.50 Variable manufacturing = 82.50 The water buckets are usually sold for $15. However, the company received a special order for 50.000 water buckets at 311 each. Assuming there is adequate manufacturing capacity and ail other variables are constant , what is the relevant cost per unit to consider when deciding whether to accept this special order at the reduced price?

Options

  • A$9.50
  • B$10.50
  • C$11
  • D$13

How the community answered

(39 responses)
  • A
    82% (32)
  • B
    10% (4)
  • C
    5% (2)
  • D
    3% (1)

Explanation

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