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Golden Generator Supply is approached by Mr. Stephen, a new customer, to fulfill a large ...

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Golden Generator Supply is approached by Mr. Stephen, a new customer, to fulfill a large ...

Golden Generator Supply is approached by Mr. Stephen, a new customer, to fulfill a large one-time-only special order for a product similar to one offered to regular customers. Golden Generator Supply has excess capacity. The following per unit data apply for sales to regular customers:

Direct materials$1,700.00
Direct manufacturing labor100.00
Variable manufacturing support200.00
Fixed manufacturing support150.00
Total manufacturing costs2,150.00
Markup (30% of total manufacturing costs)645.00
Estimated selling price$2,795.00

If Mr. Stephen wanted a long-term commitment, and not a one-time-only special order, for supplying this product, calculate the most likely price to be quoted assuming the markup remains same?
A) $2,000
B) $2,150
C) $2,795
D) $2,800

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fomor Author

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Thank you for helping me with my quiz

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