mayer company produces and sells a food processor that it prices at a 32 percent mar 3384337

Mayer Company produces and sells a food processor that it prices at a 32 percent markup on total cost. Based on data pertaining to producing and selling 50,000 food processors, Mayer computes the sales price per food processor as follows: Unit-level costs …………. $ 600,000 Fixed costs ………….. 400,000 Total cost (a) ………….. $1,000,000 Markup (a x .32) ………… 320,000 Total sales revenue (b) ……… $1,320,000 Sales price per unit (b ÷ 50,000) ….. $ 26.40 Required a. Mayer receives a special order for 7,000 food processors for $16 each. Mayer has excess capacity. Calculate the contribution margin per unit for the special order. Based on the contribution margin per unit, should Mayer accept the special order? b. Support your answer by preparing a contribution margin income statement for the special order.

 

"Looking for a Similar Assignment? Get Expert Help at an Amazing Discount!"

order now
Get 15% Discount: Coupon code [ SAVE15 ]