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Question # 7: Although the Nouman Company has the capacity to produce 16,000 units per month, current plans call for monthly production and sales of only 10,000 units at Rs.15 each. Costs per unit are as follows. Direct Materials..... 5.5 Direct Labor..... 3.00 Variable Factory Overhead.. 0.75 Fixed Factory overhead........... 1.50 Variable Marketing Expense..... 0.25 Fixed Marketing Expense..... 1.00 Required: 1) Recommendation as to whether the company should accept a special order of 4,000 units @ 10. 2) The maximum price the Nouman Company should be willing to pay an outside supplier who is interested in manufacturing this product. 3) The unit cost figure the company would use in costing inventory, using direct costing. 4) The unit cost figure the company would use in costing inventory, using absorption costing. 5) The effect on the monthly contribution margin if the sales price were reduced to 13 resulting in a 20% increase in sales volume