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(1.) ACCEPTANCE OF ADDITIONAL ORDERS. Grips and Turns Corp. manufactures door knobs and cabinet handles. It has enough capacity to accept a special order of
(1.) ACCEPTANCE OF ADDITIONAL ORDERS. Grips and Turns Corp. manufactures door knobs and cabinet handles. It has enough capacity to accept a special order of 10,000 cabinet handles at P8.00 per handle. A predicted income statement for the vear without this special order is as follows: If an order is accepted, variable selling costs on the special order would be reduced by 25% because all of the handles would be packed and shipped in one lot. However, if the offer is accepted, management estimates that it will lose the sale of 2,000 handles at regular prices. Should management accept the offer
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