A Local Manufacturer Has Been Approached to Supply a Special

Multiple Choice

A local manufacturer has been approached to supply a special order for 500 ceramic vases at a price of $20 per vase.The current cost of producing the vases is made up of direct materials of $10 per vase,direct labour costs of $8 per vase,direct overhead costs of $5 per vase plus fixed overhead costs of $5 each.The company has sufficient spare capacity to manufacture the order without affecting its normal production.Should they accept the order?

A) Yes.
B) No.
C) Yes, as long as there are no adverse long-term effects of accepting the order that outweigh the short-term benefits.
D) Yes, as long as the customer pays for the order in cash.