Grounded Coffee Products Manufactures Coffee Tables Grounded Coffee Products Is Approached by an Overseas Customer to Policy

question 204

Multiple Choice

Grounded Coffee Products manufactures coffee tables.Grounded Coffee Products has a policy of adding a 20% markup to full costs and currently has excess capacity.The following information pertains to the company's normal operations per month: $\begin{array}{lll}\text { Output units } & 20,000 \text { tables } \\\text { Machine-hours } & 8,000 \text { hours } \\\text { Direct manufacturing labor-hours } & 10,000 \text { hours } \\\text { Direct materials per unit } & \$ 105 \\\text { Direct manufacturing labor per hour } & \$ 10\\\text { Variable manufacturing overhead costs } & \$ 322,500 \\\text { Fixed manufacturing overhead costs } & \$ 1,200,000 \\\text { Product and process design costs } & \$ 1,100,000 \\\text { Marketing and distribution costs } & \$ 1,125,000\end{array}$ Grounded Coffee Products is approached by an overseas customer to fulfill a one-time-only special order for 1,000 units.All cost relationships remain the same except for a one-time setup charge of $20,000.No additional design,marketing,or distribution costs will be incurred.What is the minimum acceptable bid per unit on this one-time-only special order?

• A) $146.125
• B) $1346.125
• C) $126.125
• D) $946.125

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Definitions:

Construct Validity

The extent to which a test or instrument accurately measures the theoretical construct or concept it is intended to measure.

Split-half Reliability

A measure of consistency where a test is divided into two parts and the scores for each half are compared to assess the test's reliability.

Internal Consistency

A measure of the reliability of a test or scale, indicating how well the items on the test measure the same construct or concept.

Content Validity

The degree to which a test or measurement accurately represents the concept it intends to measure, based on the thoroughness of the content included.