Answer the Following Questions Using the Information Below:
Weather Inc

question 82

Multiple Choice

Answer the following questions using the information below:
Weather Inc., manufactures single room sized air conditioners. The cost accounting system estimates manufacturing costs to be $190 per air conditioner, consisting of 75% variable costs and 25% fixed costs. The company has surplus capacity available. It is Weather Inc.'s policy to add a 30% markup to full costs.
-Zolas' Heaters is approached by Ms.Leila,a new customer,to fulfill a large one-time-only special order for a product similar to one offered to regular customers.Zolas' Heaters has excess capacity.The following per unit data apply for sales to regular customers: $$\begin{array} { l r } \text { Direct materials } & \$ 400 \\\text { Direct manufacturing labor } & 120 \\\text { Variable manufacturing support } & 60 \\\text { Fixed manufacturing support } & 200 \\\quad \text { Total manufacturing costs } & 780 \\\text { Markup (20\% of total manufacturing costs) } & 156 \\\text { Estimated selling price } & \$ 936\end{array}$$ For Zolas' Heaters,what is the minimum acceptable price of this one-time-only special order?

• A) $580
• B) $780
• C) $520
• D) $1,014

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Definitions:

Weakness

A reduction in the strength or efficacy of something, such as physical power, structural integrity, or an argument.

-Emia

A suffix used in medical terminology to indicate a condition of the blood, such as hypoglycemia (low blood sugar).

Blood

A body fluid in humans and other animals that delivers necessary substances such as nutrients and oxygen to the cells and transports metabolic waste products away.

Professional Liability

Refers to the legal obligation of professionals to compensate for losses caused by their negligence or errors in their provided services.