Lesson Plan

• Describe the concept of contribution margin and its relevance to special‑order decisions.
• Calculate contribution per unit and total contribution for a special order using variable‑cost data.
• Identify relevant and irrelevant costs when evaluating a special order.
• Analyse capacity and opportunity‑cost implications to reach a justified decision.
• Communicate the decision rationale in clear business language.

• Projector and screen
• Whiteboard and markers
• Printed worksheet with cost tables and special‑order scenario
• Calculator or spreadsheet software
• Handout of the contribution‑costing decision flowchart
• Sticky notes for group brainstorming

Begin with a quick poll: “When would a company accept a lower‑priced order?” Connect this to students’ prior knowledge of contribution margin. Explain that today they will learn a systematic way to decide whether a special order adds profit, and they will be able to justify their decision in written form.

1. Do‑Now (5’) – short quiz on contribution margin and variable costs.
2. Mini‑lecture (10’) – review key concepts and outline the 7‑step decision process.
3. Guided practice (15’) – solve the Alpha Widgets example together, completing calculations on the worksheet.
4. Group activity (15’) – each group receives a new special‑order case, identifies relevant costs, computes contribution, and considers capacity.
5. Whole‑class debrief (10’) – groups present net contribution and decision; teacher highlights common pitfalls.
6. Check for understanding (5’) – exit ticket: one sentence justification for accepting or rejecting a given order.

Summarise how contribution costing isolates the incremental profit of a special order and why capacity matters. Collect exit tickets as a retrieval check and assign homework: students must analyse a different special‑order scenario and write a brief decision report.