1 Land O'Lakes has received a special order for 15,000 units of butter at a special price of $3.75. Assume that Land O'Lakes would need to rent additional equipment to fulfill the order, at a cost of $12,500. Their other production and sales will otherwise be unoffected. If Land O'lakes accepts the order, what effect will the order have on the company's net income? Should they accept the special order? What would be the lowest sales price needed to make this special order acceptable? 2 3 4 5 Special order (in units) Special order price per unit Special equipment cost C D E 7 1) Incremental Revenve 2) Incremental costs 3) Impact to Net Income 4) Should Land O'Lakes ACCEPT or NOT ACCEPT the special order? 5) Minimum price Land OLakes should accept? 1 Land O'Lakes has received a special order for 15,000 units of butter at a special price of $3.75. Assume that Land O'Lakes would need to rent additional equipment to fulfill the order, at a cost of $12,500. Their other production and sales will otherwise be unoffected. If Land O'lakes accepts the order, what effect will the order have on the company's net income? Should they accept the special order? What would be the lowest sales price needed to make this special order acceptable? 2 3 4 5 Special order (in units) Special order price per unit Special equipment cost C D E 7 1) Incremental Revenve 2) Incremental costs 3) Impact to Net Income 4) Should Land O'Lakes ACCEPT or NOT ACCEPT the special order? 5) Minimum price Land OLakes should accept