Author Question: Longball Company manufactures basketball backboards. The following information pertains to the ... (Read 66 times)

DelorasTo · **on:** Mar 6, 2021

Longball Company manufactures basketball backboards. The following information pertains to the company's normal operations per month:

Output units

15,000 boards

Machine-hours

4,000 hours

Direct manufacturing labor-hours

5,000 hours

Direct manufacturing labor per hour

$12

Direct materials per unit

$100

Variable manufacturing overhead costs

$150,000

Fixed manufacturing overhead costs

$300,000

Product and process design costs

$200,000

Marketing and distribution costs

$250,000

Required:
a. For long-run pricing, what is the full-cost base per unit?
b. Longball Company is approached by an overseas city to fulfill a one-time-only special order for 1,000 units. All cost relationships remain the same except for an additional one-time setup charge of $40,000. No additional design, marketing, or distribution costs will be incurred. What is the minimum acceptable bid per unit on this one-time-only special order?

BAOCHAU2803 · **Reply #1 on:** Mar 6, 2021

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