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Business · Accounting
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stion 1 Special Order Decision (7 marks Juliani Company produces a single product. The cost of producing and selling a single unit of thi product at the companys normal activity level of 50.000 units per month is as followS Direct materials Direct labor Variable manufacturing overhead 7.50 50 20.90 1.90 7.30 Fixed manufacturing overhead Variable selling& administrative expense Fixed selling & administrative expense The normal selling price of the product is $75.00 per unit An order has been received from overseas special discounted price. This order would have no effect on the companys normal sales and the tota amount of the companys fixed selling & administrative expense m an overseas customer for 3,000 units to be delivered this month at decrease by 10%. The variabl than on normal sale would selling and administrative expense would decrease by $1.50 per unit on this order Direct labor is a variable cost in this company Required: Suppose there is sufficient capacity to produce the units required by the overseas customer and the special discounted price on the special order is S60.50 per unit. Should the company accept the or ?Support your answer by the relevant calculations

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