Radke, Inc. gathered the following information regarding its one and only product: Required:
a. Compute the unit manufacturing cost of the product under the absorption approach.
b. Compute the unit manufacturing cost of the product under the contribution approach.
c. Compute the effect on net income of accepting a special order for 1,000 units at $20 per unit assuming excess capacity.

Question

Radke, Inc. gathered the following information regarding its one and only product:  Required:
a. Compute the unit manufacturing cost of the product under the absorption approach.
b. Compute the unit manufacturing cost of the product under the contribution approach.
c. Compute the effect on net income of accepting a special order for 1,000 units at $20 per unit assuming excess capacity.

Quizplus · Accepted Answer

The Answer of Radke, Inc. gathered the following information regarding its one and only product:  Required:
a. Compute the unit manufacturing cost of the product under the absorption approach.
b. Compute the unit manufacturing cost of the product under the contribution approach.
c. Compute the effect on net income of accepting a special order for 1,000 units at $20 per unit assuming excess capacity.