Kasten, Inc budgeted 10,000 widgets for production during 2013. Kasten has capacity to produce 12,000 units. Fied factory overhead is allocated to production. The following estimated costs were provided:Direct material ($7.00/unit) $70,000Direct Labor ($15/hr x 2 hrs/unit) 300,000Vairable manufacturing overhead) $4/unit) 40,000Fixed factory overhead costs ($5/unit) 50,000Total $460,000Cost per unit = $461. Kasten received an order for 1,000 units from a new customer in a country in which Kasten has never done business. This customer has offered $43 per widget. Should Kasten accept the order?2. Kasten received an offer from another company to manufature the same quality widgets for $39. Should Kasten let someone else manufacture all 10,000 widgets and focus only on distribution?
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Home » Business » Kasten, Inc budgeted 10,000 widgets for production during 2013. Kasten has capacity to produce 12,000 units. Fied factory overhead is allocated to production. The following estimated costs were provided:Direct material ($7.