(Solution) - Mansour Automotive Company manufactures an engine designed for m -(2025 Original AI-Free Solution)

Paper Details

Mansour Automotive Company manufactures an engine designed for motorcycles and markets the product using its own brand name. Although Mansour has the capacity to produce 40,000 engines annually, it currently produces and sells only 30,000 units per year. The engine normally sells for $500 per unit, with no quantity discounts. The unit-level costs to produce the engine are $200 for direct materials, $150 for direct labor, and $30 for indirect manufacturing costs. Mansour expects total annual product- and facility-level costs to be $540,000 and $750,000, respectively. Assume Mansour receives a special order from a new customer seeking to buy 1,000 engines for $370 each.
Required
Should Mansour accept or reject the special order? Support your answer with appropriate computations.