Wagner Company Sells Product a for $21 Per Unit A Special Order Offering to Buy 20,000 Units Has Been

question 53

Multiple Choice

Wagner Company sells product A for $21 per unit. full capacity of 200,000 units is as follows: $$\begin{array} { | l | c | } \hline \text { Direct materials } & \$ 4 \\\hline \text { Direct labour } & 5 \\\hline \text { Manufacturing overhead } & 6 \\\hline \text { Unit product cost } & \underline { \$ 15 } \\\hline\end{array}$$ A special order offering to buy 20,000 units has been received from a foreign distributor. The only selling costs that would be incurred on this order would be $2 per unit for shipping. Wagner has sufficient idle capacity to manufacture the additional units.
Two-thirds of the manufacturing overhead is fixed and would not be affected by this order. Assume that direct labour is an avoidable cost in this decision. In negotiating a price for
The special order, the minimum acceptable selling price per unit should be:

• A)$15.
• B)$17.
• C)$16.
• D)$13.

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Definitions:

Postmodern

A movement or perspective characterized by skepticism towards grand narratives and ideologies, emphasizing relative truths and cultural pluralism.

Cultural Leveling

The process whereby distinct cultural differences among societies or groups become less distinct, leading to a more homogeneous global culture.

Incipient Social Movement

An emerging collective effort aimed at social change that is in its early stages of development and not yet fully established or widely recognized.

Primitivism

An artistic or philosophical advocacy for a return to simple, non-industrial society ways or valorization of what are seen as the unspoiled and authentic practices of non-urbanized peoples.