A company has just received a special, one-time order for 1,000 units. Producing the order will have no effect on the production and sales of other units. The buyer's name will be stamped on each unit, at a total cost of $2,000. Normal cost data, excluding stamping, follows: $$\begin{array} { l r }
\text { Direct materials } & \$ 10 \text { per unit } \
\text { Direct labor } & 16 \text { per unit } \
\text { Variable overhead } & 4 \text { per unit } \
\text { Allocated fixed overhead } & 12 \text { per unit } \
\text { Allocated fixed selling expense } & 8 \text { per unit }
\end{array}$$
What selling price per unit will this company require to earn $3,000 on the order?

Question

A company has just received a special, one-time order for 1,000 units. Producing the order will have no effect on the production and sales of other units. The buyer's name will be stamped on each unit, at a total cost of $2,000. Normal cost data, excluding stamping, follows: $$\begin{array} { l r } 
\text { Direct materials } & \$ 10 \text { per unit } \
\text { Direct labor } & 16 \text { per unit } \
\text { Variable overhead } & 4 \text { per unit } \
\text { Allocated fixed overhead } & 12 \text { per unit } \
\text { Allocated fixed selling expense } & 8 \text { per unit }
\end{array}$$
What selling price per unit will this company require to earn $3,000 on the order?

Quizplus · Accepted Answer

The Answer of A company has just received a special, one-time order for 1,000 units. Producing the order will have no effect on the production and sales of other units. The buyer's name will be stamped on each unit, at a total cost of $2,000. Normal cost data, excluding stamping, follows: $$\begin{array} { l r } 
\text { Direct materials } & \$ 10 \text { per unit } \
\text { Direct labor } & 16 \text { per unit } \
\text { Variable overhead } & 4 \text { per unit } \
\text { Allocated fixed overhead } & 12 \text { per unit } \
\text { Allocated fixed selling expense } & 8 \text { per unit }
\end{array}$$
What selling price per unit will this company require to earn $3,000 on the order?

A Company Has Just Received a Special, One-Time Order for 1,000