Perreth Industries has an annual plant capacity of 70,000 units; current production is 55,000 units per year.
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1. How would accepting the special order impact Perreth's operating income? Should Perreth accept the special order?
2. How would your analysis change if the special order sales price were to be $40.00 per unit and Perreth would have to pay an attorney a fee of $15,000 to make sure it is complying with export laws and regulations relating to the special order?
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