Kitchens Sales inc. has excess capacity. Mr. Cifer wants the cabinets in cherry rather than oak, so direct material costs will increase by $66 per unit. The average marketing cost of Kitchens Sales product is $173 per order. Other than price, what other items should Kitchens Sales consider before accepting this one-time-only special order

Question

Business

Cortez Burnett

30 April, 13:17

Kitchens Sales inc. has excess capacity. Mr. Cifer wants the cabinets in cherry rather than oak, so direct material costs will increase by $66 per unit. The average marketing cost of Kitchens Sales product is $173 per order. Other than price, what other items should Kitchens Sales consider before accepting this one-time-only special order

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Answers (1)

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Walter Bray · Answer 1

B) reaction of existing customers to the lower price offered to Mr. Louis Cifer

Explanation:

In case when the company accepts one-time special order the shareholder does not have any problem regarding it as it the company has excess capacity and in case of the special order, the income of the company is high as compared to before when the products are sold at lesser prices

Moreover, the one-time special order is the order that to be ordered one time only that means it never repeated again

So in this situation, option B is most appropriate