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5 September, 09:35

1. Crandle Manufacturers Inc. is approached by a potential customer to fulfill a one-time-only special order for a product similar to one offered to domestic customers. The company has excess capacity. The following per unit data apply for sales to regular customers: Variable costs: Direct materials $130 Direct labor 110 Manufacturing support 125 Marketing costs 65 Fixed costs: Manufacturing support 175 Marketing costs 85 Total costs 690 Markup (50%) 345 Targeted selling price $1,035 What is the full cost of the product per unit

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  1. 5 September, 09:44
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    Full cost per unit = $690

    Explanation:

    The full cost of a product is the sum of its variable cost per unit and its fixed cost per unit. Costing a product at its full cost ensures that all costs are recovered both variable cost and fixed cost

    The full cost for Crandle's product would be:

    $

    Material 130

    Labour 110

    Manufacturing 125

    Market 65

    Variable cost 430

    Fixed cost

    Manufacturing 175

    Marketing 85

    Full cost per unit 690

    Full cost per unit = $690
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