Gracius Manufacturing Is Approached by a European Customer to Fulfill

question 8

Multiple Choice

Gracius Manufacturing is approached by a European customer to fulfill a one-time-only special order for a product similar to one offered to domestic customers.Gracius Manufacturing has a policy of adding a 10% markup to full costs and currently has excess capacity.The following per unit data apply for sales to regular customers: $\begin{array}{l}\text { Varible costs: }\\\begin{array}{lr}\text { Direct materials } & \$ 30 \\\text { Direct labor } & 10 \\\text { Manufacturing overhead } & 20 \\\text { Marketing costs } & 10\\\text { Fixed costs: }\\\text { Manufacturing overhead }& 100 \\\text { Marketing costs } & 190 \\\text { Total costs } & 190 \\\text { Markup ( } 10 \% \text { of total costs) } & 1909 \\\text { Estimated ælling price } & \$ 20\end{array}\end{array}$ If the European customer 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) $70.00
• B) $190.00
• C) $209.00
• D) $239.00

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Definitions:

Complementary Offerings

Products or services that enhance or are intended to be used together with another, creating more value for consumers.

Pricing Changes

Alterations made to the selling price of goods or services in response to market demands, cost fluctuations, or strategies.

Integrated Marketing Communications

A strategic marketing process designed to ensure that all messaging and communication strategies are unified across all channels to deliver a consistent message.

Consistent Message

Communication that is uniform and coherent across all marketing channels, ensuring that the brand's image and values are reinforced with each consumer interaction.