1 of 2 View Policies Current Attempt in Progress -18 E Gruden Company produces golf discs, which it normally sells to retailers for $11 each. The cost of manufacturing 25,000 golf discs is: Materials $11,000 Labour 30,500 Variable overhead 21,000 Fixed overhead 42,500 Total $105,000 Gruden also incurs 5% sales commission ($0.55) on each disc sold. McGee Corporation offers Gruden $6.60 per disc for 6,250 discs. McGee would sell the discs under its own brand name in foreign markets not yet served by Gruden. If Gruden accepts the offer, its fixed overhead will increase from $42,500 to $48,800 due to the purchase of a new imprinting machine. No sales commission will result from the special order. Prepare an incremental analysis for the special order. (Round per unit calculations to 2 decimal places, eg. 15.25 and final answers to O decimal places, eg. 5,275.) Incremental contribution margin Incremental cost: Fixed cost Incremental income eTextbook and Media Question Part Score Should Gruden accept the special order? Why or why not? Gruden should eTextbook and Media Question Part Score: the special order, as it will their net income by $ What assumption underlies the decision made in part (b)? The assumption underlying the decision is that current sales eTextbook and Media Question Part Score be affected if Gruden accepts the offer. /4 --/3 --/1