Golden Generator Supply Is Approached by Mr If MrStephen Wanted a Long-Term Commitment,and Not a One-Time-Only Special Order,for

question 104

Multiple Choice

Golden Generator Supply is approached by Mr.Stephen,a new customer,to fulfill a large one-time-only special order for a product similar to one offered to regular customers.Golden Generator Supply has excess capacity.The following per unit data apply for sales to regular customers: $$\begin{array} { l r } \text { Direct materials } & \$ 1,700.00 \\\text { Direct manufacturing labor } & 100.00 \\\text { Variable manufacturing support } & 200.00 \\\text { Fixed manufacturing support } & \underline { 150.00 } \\\quad \text { Total manufacturing costs } & 2,150.00 \\\text { Markup (30\% of total manufacturing costs) } & 645.00 \\\text { Estimated selling price } & \$ 2,795.00 \\\hline\end{array}$$ If Mr.Stephen wanted a long-term commitment,and not a one-time-only special order,for supplying this product,calculate the most likely price to be quoted assuming the markup remains same?

• A) $2,000
• B) $2,150
• C) $2,795
• D) $2,800

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