Author Question: Gracius Manufacturing is approached by a European customer to fulfill a one-time-only special order ... (Read 32 times)

ereecah · **on:** Mar 6, 2021

Gracius Manufacturing is approached by a European customer to fulfill a one-time-only special order for a product similar to one offered to domestic customers. Gracius Manufacturing has a policy of adding a 10% markup to full costs and currently has excess capacity. The following per unit data apply for sales to regular customers:

Variable costs:

Direct materials

$90

Direct labor

30

Manufacturing overhead

40

Marketing costs

30

Fixed costs:

Manufacturing overhead

180

Marketing costs

10

Total costs

380

Markup (10% of total costs)

38

Estimated selling price

$418

For Gracius Manufacturing, what is the minimum acceptable price of this one-time-only special order?
◦ $120
◦ $160
◦ $190
◦ $380

LVPMS · **Reply #1 on:** Mar 6, 2021

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