Answer the Following Questions Using the Information Below:
Welch Manufacturing

question 61

Multiple Choice

Answer the following questions using the information below:
Welch Manufacturing is approached by a European customer to fulfil a one-time-only special order for a product similar to one offered to domestic customers.Welch Manufacturing has excess capacity.The following per unit data apply for sales to regular customers:
$$\begin{array} { l r } \text { Variable costs: } & \\\quad \text { Direct materials } & \$ 40 \\\quad \text { Direct labour } & 20 \\\text { Manufacturing support } & 35 \\\quad \text { Marketing costs } & 15 \\\text { Fixed costs: } & \\\quad \text { Manufacturing support } & 45 \\\quad \text { Marketing costs } & 15 \\\text { Total costs } & 170 \\\text { Mark-up (50\%) } & \underline { 85 } \\\text { Targeted selling price } & \$ 255\end{array}$$
-What is the full cost of the product per unit?

• A)$255
• B)$170
• C)$110
• D)$85

---

Definitions:

Deduction

The process of reasoning from one or more general premises to reach a logically certain conclusion.

Analogy

A comparison between two things, typically for the purpose of explanation or clarification.

Conclusion

A conclusion is the final part of an argument or process, logically deduced from the premises or evidence presented.

Diamonds

A form of carbon, diamonds are renowned for their physical properties, particularly their hardness and optical dispersion, making them valuable for jewelry and industrial applications.