Polaski Company manufactures and sells a single product called a Ret..docx

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Polaski Company manufactures and sells a single product called a Ret. Operating at capacity, the company can produce and sell 38,000 Rets per year. Costs associated with this level of production and sales are given below Total Unit Direct materials 25 950,000 228,000 Direct labor Variable manufacturing overhead 114,000 266,000 Fixed manufacturing overhead Variable selling expense 152,000 228,000 Fixed selling expense Total cost S 51 S 1,938,000 The Rets normally sell for $56 each. Fixed manufacturing overhead is constant at $266,000 per year within the range of 29,000 through 38,000 Rets per year Required: 1. Assume that due to a recession, Polaski Company expects to sell only 29,000 Rets through regular channels next year. A large retail chain has offered to purchase 9,000 Rets if Polaski is willing to accept a 16% discount off the regular price. There would be no sales commissions on this order, thus, variable selling expenses would be slashed by 75%. However, Polaski Company would have to purchase a special machine to engrave the retail chain\'s name on the 9,000 units. This machine would cost $18,000. Polaski Company has no

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