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(solution) The Cintron Company sells their single product for $60 per unit.


The Cintron Company sells their single product for $60 per unit. Unit product costs are as follows:


Direct materials$20

Direct labor20

Manufacturing overhead4

Total$44

A special order to purchase 10,000 units was recently received. There is enough capacity to fill the order and filling this order would not disrupt current operations. The Cintron Company would incur an additional $5 per unit for additional labor costs due to a slight modification the buyer wants made to the original product. One-fourth of the manufacturing overhead costs is fixed and would be incurred no matter how many units are produced. In negotiating a price, the minimum acceptable selling price would be

A$44
B$45
C$48
D$60

 


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