4. Assume that Mohave is operating at full capacity. Calculate the special-order price per unit at which Mohave would be indifferent between accepting or rejecting the special order.

Profit (or Loss) Increase or Decrease by ( )

Mohave Corp. makes several varieties of beach umbrellas and accessories. It has been approached by a company called Lost Mine Industries about producing a special order for a custom umbrella called the Ultimate Shade (US). The special-order umbrellas wh the Lost Mine Company lago would be distributed to participants at an upcoming convention sponsored by Lost Mine. Lost Mine has offered to buy 2,900 of the US umbrellas at a price of $27 each. Mohave currently has the excess capacity necessary to accept the offer. The follawing information is related to the production of the US umbrella: Direct materials Diroct labor Vanable manutacturing overhead Fixed manufacturing overhead 512.00 6.00 8.00 250 Total cost Regular sales price $35 00 Required: 1. Compute the incremental profit (or loss) from accepting the special order rotit (or Loss) Increascs by 2. Should Mohave accept the special order? No Yes 3. Suppose that the special order had been to purchase 3,400 umbrellas for $25.00 each. Recompute the incremental profit (or loss) from accepting the special order under this scenaric by