Oriole, Inc, budgeted 8,800 widgets for production during 2022. Oriole has capacity to produce 10,800...
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Oriole, Inc, budgeted 8,800 widgets for production during 2022. Oriole has capacity to produce 10,800 units. Fixed factory overhead is allocated to production. The following estimated costs were provided: Direct material ($10/unit) $88,000 Direct labor ($19/hr. 2 hrs./unit) 334,400 Variable manufacturing overhead ($7/unit) 61,600 Fixed factory overhead costs ($8/unit) 70,400 Total $554,400 Cost per unit $63 Oriole received an order for 880 units from a new customer in a country in which Oriole has never done business. This customer has offered $60 per widget Should Oriole accept the order? Oriole received an offer from another company to manufacture the same quality widgets for $50. Should Oriole outsources the manufacture of all 8,800 widgets and focus only on distribution? e Textbook and Media
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