Zaccagnino Corporation Makes a Range of Products

question 20

Essay

Zaccagnino Corporation makes a range of products.The company's predetermined overhead rate is $14 per direct labor-hour,which was calculated using the following budgeted data: Management is considering a special order for 300 units of product D03C at $119 each.The normal selling price of product D03C is $157 and the unit product cost is determined as follows: If the special order were accepted,normal sales of this and other products would not be affected.The company has ample excess capacity to produce the additional units.Assume that direct labor is a variable cost,variable manufacturing overhead is really driven by direct labor-hours,and total fixed manufacturing overhead would not be affected by the special order.
Required:
If the special order were accepted,what would be the impact on the company's overall profit?

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Definitions:

Gestalt Principle

Principles that describe the brain's organization of sensory information into meaningful units and patterns, illustrating how people perceive visual components as whole entities rather than as separate parts.

Common Fate

A gestalt principle that states elements moving in the same direction are perceived as a collective or unit.

Retina

A layer of visual receptor cells at the rear of the eyeball.

Visual Search Tasks

Visual search tasks are experiments or tasks in which individuals are asked to locate a specific item or feature among a set of distractors, used to study attention, perception, and cognitive processes.