Bob Johnson, Inc., sells a lounging chair for $24 per unit. It incurs the following costs for the product: direct materials, $11; direct labor, $8; variable overhead, $3; and fixed overhead, $2.
The company has received a special order for 52 chairs. The order would require rental of a special tool for $290. Bob Johnson, Inc., has sufficient idle capacity to produce the chairs for this order.
Required:
Calculate the minimum price per chair that the company could charge for this special order if management requires a $570 minimum profit on any special order. Do not round your intermediate calculations. If required, round your answer to two decimal places.
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