Reference no: EM132737234

Question - Oz manufactures high-tech mobile phones. Oz has a policy of adding a 30% mark-up to full costs and currently has excess capacity. The following information pertains to the company's normal operations per month:

Output units 20 000 phones

Machine-hours 8 000 hours

Direct manufacturing labour-hours 5 000 hours

Direct materials per unit $25

Direct manufacturing labour per hour $20

Variable manufacturing overhead costs $175,000

Fixed manufacturing overhead costs $425,000

Product and process design costs $400,000

Marketing and distribution costs $475,000

Oz is approached by an overseas customer to fulfil a one-time-only special order for 1000 units. All cost relationships remain the same except for a one-time set-up charge of $15 000. No additional design, marketing or distribution costs will be incurred. What is the minimum acceptable bid per unit on this one-time-only special order?