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:

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?
A)$1,034
B)$1,174
C)$1,104
D)$1,347

Question

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:

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?
A)$1,034 
B)$1,174 
C)$1,104 
D)$1,347

Quizplus · Accepted Answer

Full cost = $556 + $362 + $60 + $126 + $70 = $1,174