6.49 Special-order, unitized data, relevant cost analysis Award Plus manufactures medals and trophies for winners of athletic competitions and other contests. Award Plus's manufacturing plant has the capacity to produce 10,000 medals per month. Currently, Award Plus is operating at 75% of available capacity, producing 7,500 medals per month. Pertinent data for this level of operations follows: Medals produced and sold Selling price Fixed costs:* 7,500 $175 per medal $46 per medal $34 per medal Manufacturing Marketing & administrative Variable costs: Direct materials Direct labor $50 per medal $40 per medal $5 per medal Profit *Award Plus calculates fixed costs per medal by dividing the annual fixed cost by the number of medals it expects to produce during the year Recently, Award Plus received an inquiry from a national Little League baseball organization about the possibility of producing 1,800 medals next month. The Little League organization plans to give the medals to the winners of the upcoming state tournaments. Since there are 50 states, 3 age brackets, and approximately 12 players per team, the organization needs 1,800 medals (i.e., 1,800 50 x 3 x 12). The Little League organization, however, indicates that they are somewhat strapped for cash and can only pay $100 for each medal. Required: a. Using the fol lowing table, indicate whether each item is relevant or not relevant for computing the incremental profit on the special order. Assume that Award Plus's relevant range of operations is between 5,000 and 10,000 medals. Relevant? (Y or N) Item Regular selling price ($175 Special order price ($100) Direct materials cost Direct labor cost Fixed manufacturing cost Fixed marketing & administrative cost b. By how much will Award Plus's profit increase or decrease if it accepts the special order? $ c. Assume that Award Plus's manufacturing plant has the capacity to produce only 9,000 medals per month rather than 10,000 medals per month. This means that if Award Plus accepts the special order, it will have to forego sales of 300 medals to its regular customers (i.e., the special order cannot be partially fulfilled). How does this information affect your answer to part (b)? That is, by how much will Award Plus' profit increase or decrease if it accepts the special order when plant capacity is only 9,000 medals? $