29 Jun ACC 210-A manager of Coastal Sporting Goods Company
Question
A manager of Coastal Sporting Goods Company is considering accepting an order from an overseas customer. This customer has requested an order for 50,000 dozen golf balls at a price of $12 per dozen. The variable cost to manufacture a dozen golf balls is $9 per dozen. The full cost is $14 per dozen. Coastal Sporting Goods has a normal selling price of $24 per dozen. Coastal’s plant has just enough excess capacity on the second shift to make the overseas order.
Question:
What are the considerations to think about/discuss in accepting or rejecting this order?
Would you accept or reject the order? Why?
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