I also put down 8150 for the question in red and it was wrong also....
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I also put down 8150 for the question in red and it was wrong also. Please show work thank you
Delta Company produces a single product. The cost of producing and selling a single unit of this product at the company's normal activity level of 100,800 units per year is: Direct materials $ 2.00 Direct labor $ 3.00 Variable manufacturing overhead $ 80 Fixed manufacturing overhead $ 4.05 Variable selling and administrative expenses $ 2.00 Fixed selling and administrative expenses $ 2.00 The normal selling price is $23 per unit. The company's capacity is 112,800 units per year. An order has been received from a mail-order house for 1,000 units at a special price of $20.00 per unit. This order would not affect regular sales. Required: 1. If the order is accepted, by how much will annual profits be increased or decreased? (The order will not change the company's total fixed costs.) Answer is complete but not entirely correct. Annual profits would Increase by $ 6,150 X 2. Assume the company has 500 units of this product left over from last year that are inferior to the current model. The units must be sold through regular channels at reduced prices. What unit cost is relevant for establishing a minimum selling price for these units? (Round your answer to 2 decimal places.) Answer is complete and correct. Relevant cost per unit $2.00
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