Duncan Co Sells Product P at a Price of $38 a a Unit

question 12

Multiple Choice

Duncan Co. sells product P at a price of $38 a unit. The per-unit cost data are: direct materials $8, direct labour $10, and overhead $12 (25% fixed and 75% variable) . Wolff has sufficient capacity to accept a special order for 40,000 units just received. Selling costs associated with this order would be $3 per unit.
The minimum selling price per unit should be:

• A) $24
• B) $30
• C) $32
• D) $36

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Definitions:

Searching for Analogies

The cognitive process of identifying relationships between seemingly unrelated concepts or objects to aid in problem solving or understanding.

Problem-Solving Heuristic

A general strategy or approach to finding a solution for problems, typically involving shortcuts or rules of thumb.

Printer

A device that transfers text and graphics from a computer onto paper.

Working Backward

A problem-solving strategy that starts from the desired solution and works in reverse to determine the steps needed to achieve that solution.