Packer Concrete Company pours concrete slabs for single-family dwellings. Wolff
ID: 2418038 • Letter: P
Question
Packer Concrete Company pours concrete slabs for single-family dwellings. Wolff Construction Company, which operates outside Packer’s normal sales territory, asks Packer to pour 53 slabs for Wolff’s new development of homes. Packer has the capacity to build 460 slabs and is presently working on 120 of them. Wolff is willing to pay only $2,680 per slab. Packer estimates the cost of a typical job to include unit-level materials, $970; unit-level labor, $430; and an allocated portion of facility-level overhead, $830.
a.
b.
Calculate the contribution to profit from the special order.Explanation / Answer
a.contribution=$450 per slab
there is no fixed cost.
b.yes
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