8. (6 points) Pfizer Company produced and sold 50,000 units of product and is operating at 75% of plant capacity. Unit information about its product is as follows Sales Price $70 Variable manufacturing cost Fixed manufacturing cost ($500,00050,000) 10 Profit per unit $45 The company received a proposal from a foreign company to buy 15,000 units of Pfizer Company' s product for $50 per unit. This is a one-time only order and acceptance of this proposal will not affect the company's regular sales. The president of Pfizer Company is reluctant to accept the proposal because he is concerned that the company will lose money on the special order Instructions a) Prepare a schedule reflecting an incremental analysis of this special order b) Should Pfizer accept/reject this order? Why? 9. (8 points) General Electric Company manufactured 6,000 units of a component part that is used in its product and incurred the following costs: Direct materials $35, 000 15, 000 10,000 Direct labor Variable manufacturing overhead Fixed manufacturing overhead Another company has oftered to sell the same component part to the company toir $12 per unit. The fixed manufacturing overhead consists mainly of depreciation on the equipment used to manufacture the part and would not be reduced if the component part was purchased trom the outside flrm. 11 the component part 1S purchased from the outside firm, General Electric Company has the opportunity to use the factory equipment to produce another product which is estimated to have a contribution margin of $14,000 Instructions a) Prepare an incremental analysis report for this make or buy decision. b) Should General Electric make or buy this component part and why? A B 1 Name Problems 8&9 2 Section 3 Date Problem 8-6 points 6 8 2 4 3 5 4 6 5 7 6 8 7 9 8 10 9 11 0 12 1 13 2 14 3 15 4 16 5 17 6 18 27 190Problem9-8 points 8 20 9 21 0 22 1 23 34