What is the lowest price northwoods should bid


Northwoods manufactures furniture. The cost accounting system estimates manufacturing costs to be $120 per table, consisting of 60% variable costs and 40% fixed costs. The company has surplus capacity available. It is Northwoods' policy to add a 50% markup to full costs. Northwoods is invited to bid on a one-time-only special order to supply 200 rustic tables. What is the lowest price Northwoods should bid on this special order?

A) $21,600

B) $7,200

C) $12,000

D) $14,400

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Accounting Basics: What is the lowest price northwoods should bid
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