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A company manufactures and sells a product for $1.25. The cost of producing ...

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Accounting

A company manufactures and sells a product for $1.25. The cost of producing
600,000 products in the prior year was: Revenues $750,000, Direct materials
330,000, Direct labor 66,000, Manufacturing overhead (fixed)132,000, Manufacturing overhead (variable)84,000. A special order was received for 15,000 products to be sold for $1.10 per product. To complete the order, the company must incur an additional $900 in total fixed costs to lease a special machine. This order will not affect any of the company's other operations and it has excess capacity to fulfill the contract. Should the company accept the special order?
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