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Nowlan Co Manufactures and Sells Trophies for Winners of Athletic and and Other

Question 151

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Nowlan Co. manufactures and sells trophies for winners of athletic and other events. Its manufacturing plant has the capacity to produce 11,000 trophies each month; current monthly production is 8,800 trophies. The company normally charges $87 per trophy. Cost data for the current level of production are shown below: Nowlan Co. manufactures and sells trophies for winners of athletic and other events. Its manufacturing plant has the capacity to produce 11,000 trophies each month; current monthly production is 8,800 trophies. The company normally charges $87 per trophy. Cost data for the current level of production are shown below: The company has just received a special one-time order for 500 trophies at $50 each. For this particular order, no variable selling and administrative costs would be incurred. This order would also have no effect on fixed costs. Required: Should the company accept this special order? Why? The company has just received a special one-time order for 500 trophies at $50 each. For this particular order, no variable selling and administrative costs would be incurred. This order would also have no effect on fixed costs.
Required:
Should the company accept this special order? Why?

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