Tyler Company has been approached by a new customer with an offer to purchase 6,000 units of its product KR200 at a price of $11 each. The existing sales would not be affected by this special order. Tyler normally produces 40,000 units but plans to produce and sell 30,000 in the coming year. The normal sales price is $18 per unit. Unit cost information is as follows:
If Tyler accepts the order, no fixed manufacturing activities will be affected because there is sufficient excess capacity.

Question

Tyler Company has been approached by a new customer with an offer to purchase 6,000 units of its product KR200 at a price of $11 each. The existing sales would not be affected by this special order. Tyler normally produces 40,000 units but plans to produce and sell 30,000 in the coming year. The normal sales price is $18 per unit. Unit cost information is as follows:
  If Tyler accepts the order, no fixed manufacturing activities will be affected because there is sufficient excess capacity.

Quizplus · Accepted Answer

The Answer of Tyler Company has been approached by a new customer with an offer to purchase 6,000 units of its product KR200 at a price of $11 each. The existing sales would not be affected by this special order. Tyler normally produces 40,000 units but plans to produce and sell 30,000 in the coming year. The normal sales price is $18 per unit. Unit cost information is as follows:
  If Tyler accepts the order, no fixed manufacturing activities will be affected because there is sufficient excess capacity.

Tyler Company Has Been Approached by a New Customer with an Offer