Answer the Following Questions Using the Information Below

Multiple Choice

Answer the following questions using the information below:
Caruso Cool manufactures single room sized air conditioners. The cost accounting system estimates manufacturing costs to be $190 per air conditioner, consisting of 75% variable costs and 25% fixed costs. The company has surplus capacity available. It is Caruso Cool's policy to add a 30% markup to full costs.
-Caruso is invited to bid on a one-time-only special order to supply 50 air conditioners. What is the lowest price Caruso should bid on this special order?

A) $9,500
B) $7,125
C) $12,500
D) $12,350