(a) Assume that present sales will not be affected. Should the order be accepted from a financial point of view? Explain.(18 marks)(b) Determine the options might Start considers if management truly wanted to do business with Indrah in hopes of building a long-term relationship with the firm.

Start Skateboard Son. Bhd. manufactures skateboards. Several weeks ago, the firm received a special-order inquiry from Indrah Son. Bhd. Indrah desires to market a skateboard similar to one of Start's and has offered to purchase 10,000 units if the order can be completed in six months. The cost data for Start's Champion model skateboard follow: RM Direct Materials 164 Direct Labour: 45 2.5 hours at RM18 Total manufacturing overhead: 40 1 machine hour at RM40,000 Total 1249 The following additional information is available: (i) The normal selling price of the Champion model is RM530; however, Indrah has offered Start only RM315 because of the large quantity it is willing to purchase. (ii) Indrah requires a modification of the design that will allow a RM42 reduction in direct material cost. (ii) Start's production supervisor notes that the company will incur RM740,000 in additional set-up costs and will have to purchase a RM480,000 special device to manufacture these units. The device will be discarded once the special order is completed. (iv) Total manufacturing overhead costs are applied to production at the rate of RM40 per machine hour. This figure is based, in part, on budgeted yearly fixed overhead of RM1,500,000 and planned production activity of 60,000 machine hours (5,000 month). (v) Start will allocate RM36,000 of existing fixed administrative costs to the order as part of the cost of doing business