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2 Poland Company manufactures and ses product called aRet Opening to produce 36.000 Rets per year Costs associated with this level of production and are

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2 Poland Company manufactures and ses product called aRet Opening to produce 36.000 Rets per year Costs associated with this level of production and are given below 3.33 Pri Dract ateriale TOTAL Dit la 1:20 $ 120,000 Variable tacting over 10 165,000 Fixed with 1 100,000 Variable in 320,00 3 Tidig 72,000 216 Total cont 350 1,600.000 The Rets normally sell for $55 each fixed manufacturing overhead is $324.000 per year in the range of 34000 rough 36.000 Rets per year. Required: 1. Assume that due to a recession, Polask Company expects to sell only 3000 Rets through regular channels next yearAwal chain has offered to purchase 5,000 Rets i Polak is willing to accept a 16% discount off the regular price. There would be no se commissions on this order, thus, variable selling expenses would be slashed by 75%. However, Polak Company would have to purchase a special machine to engrave the retail chair's name on the 5,000 units. This machine would cost $10.000. Polis Company has no assurance that the retail chain will purchase additional units in the future. What is the financial advantage avantage of accepting the special order? (Round your intermediate calculations to 2 decimal places) 2. Refer to the original data. Assume again the Polasci Company expects to sell only 31000 Rets through regular channels ned you. The U.S. Army would like to make a one-time-only purchase of 5,000 Rets. The Army would reimburse Poil for all of the variable and fixed production costs assigned to the units by the company's absorption costing system is it would pay notional fee of $180 per unit. Because the army would pick up the Rets with its own trucks, there would be no variable sing expenses asociated with this order. What is the financial advantage disadvantage of accepting the US Army's special order? 3. Assume the same situation as described in (2) above, except that the company expects to e36,000 Rets through channels next year. Thus, accepting the US Army's order would require giving up regular sales of 5,000 Rets. Given this new information what Is the financial advantage (disadvantage of accepting the US Army's special order? 1. Financial advantage 2. Parcial advantage sinancial disadvantage

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