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One Kings Lane Corporation Manufactures a Single Product with the Following

question 2

Essay

One Kings Lane Corporation manufactures a single product with the following unit costs for 10,000 units:  Direct materials $75 Direct labour 40 Manufacturing overhead (40% variable) 90 Selling expenses ( 60% variable) 30 Administrative expenses (20% variable) 15 Total per unit $250\begin{array}{lr}\text { Direct materials } & \$ 75 \\\text { Direct labour } & 40 \\\text { Manufacturing overhead (40\% variable) } & 90 \\\text { Selling expenses ( } 60 \% \text { variable) } & 30 \\\text { Administrative expenses (20\% variable) } & 15\\\text { Total per unit }&\$250\end{array} Recently, a company approached One Kings Lane Corporation about buying 2,000 units for $250. Currently, the models are sold to dealers for $450. One Kings Lane's capacity is sufficient to produce the extra 3,000 units. Selling expenses would be incurred as normal on the special order.
Required:
A. Calculate the profit earned by One Kings Lane on the original 10,000 units.
B. Should One Kings Lane accept the special order if its goal is to maximize short-run profits? How much will income be affected?
C. Determine the minimum price One Kings Lane would want to receive in order to increase profits by $15,000 on the special order.
D. When making a special order decision, what qualitative aspects of the decision should One Kings Lane Corporation consider?

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Definitions:

Projective Identification

A psychological concept where individuals project their own feelings or attributes onto others, who then may internalize and identify with these projections.

Queer Theory

An academic field that challenges normative assumptions about gender and sexuality, focusing on the fluidity and social construction of sexual identities.

Social Constructions

Concepts or perceptions of reality informed by societal norms and interactions that define what is considered to be true or real.

Gender

The range of characteristics, roles, and identities that societies construct and associate with being male, female, or non-binary, often influencing personal and social interactions.

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