| 9. G fashion the G black comt VOO Contribution margin $8,100 Fixed costs $1,500 Profit $6,600 Special order: A client wants to buy 20 units at a discounted price of $20 per unit. This is a one-time deal (i.e., a short- spare capacity to fulfill this special order without cutting back on your regular sales. a) Use the gross approach to decide whether you should take the special order: status quo (no special total amounts after adding order) the special order Revenue $9,000 X Variable costs $900 Contribution margin $8,100 Fixed costs $1,500 Prote $6,600 Should you take the special order? Why? YES -- the profit is positive with the special order NO - the low price for the special order reduces the contribution margin YES - the profit is higher with the special order b) Use the incremental approach to decide whether you should take the special order. how much each amount changes after adding the special order Incremental revenue Incremental variable costs Incremental contribution margin Incremental fixed costs 0 incremental prot Should you take the special order? Why? al