Use the Following Data for the Next 2 Questions

question 101

Multiple Choice

Use the following data for the next 2 questions:
A manufacturer operating with excess capacity has been asked to fill a special order at $7.25 per unit. The regular price is $10 per unit. No other use of the currently idle capacity can be found. The manufacturer's usual variable costs per unit are $3.50 for direct materials, $2.00 for direct labor, $1.00 for variable overhead, and $0.50 for sales commission. No sales commission would be paid on this special order. The average fixed overhead cost per unit is $0.25.
-Under the general decision rule, the minimum price per unit for this special order is

• A) $7.25
• B) $6.50
• C) $7.00
• D) $7.50

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Definitions:

Task Maturity

Refers to the level of ability and willingness of an individual or group to effectively complete a specific task or job.

Attitudes

A settled way of thinking or feeling about someone or something, typically reflected in a person's behavior.

Satisfaction

The feeling of contentment or pleasure when one's wants, needs, or expectations are fulfilled.

Personal Problems

Challenges or issues that directly affect an individual, often relating to personal relationships, health, or emotional well-being.