Anthony Walker operates a small machine shop. He manufactures one standard product that is also available from many other similar businesses, and he also manufactures deluxe products to order. His accountant prepared the following annual income statement:

		Deluxe Sales			Standard Sales			Total
Sales		$60,500			$30,250			$90,750
Costs
Material		12,100			9,680			21,780
Labour		24,200			10,890			35,090
Depreciation		7,623			4,356			11,979
Power		847			484			1,331
Rent		7,260			1,210			8,470
Heat and light		726			120			846
Other		484			1,090			1,574
Total costs		53,240			27,830			81,070
Net income		$7,260			$2,420			$9,680

The depreciation charges are for machines used in the product lines. The power charge is apportioned based on an estimate of the power consumed by each line. The rent is for the building space, which has been leased for 10 years at $8,470 per year. The rent and the heat and light costs are apportioned to the product lines based on the amount of floor space occupied by each line. All other costs are current expenses that are identified with the product line causing them. A valued customer has asked Mr. Walker if he would manufacture 6,050 of the deluxe products for him. Mr. Walker is working at capacity and would have to give up some other business in order to take this order. He cannot cancel deluxe orders he has already agreed to, so he would have to reduce the output of his standard product by about one-half for a year while producing the requested deluxe product. The customer is willing to pay $7.00 for each unit. The material cost will be about $2.00 per unit and the labour will be $3.60 per unit. Mr. Walker will have to spend $2,420 for a special device that will be discarded when the job is done.

1) Calculate the incremental cost of the order.

2) Calculate the full cost of the order.

3) Calculate the opportunity cost of taking the order.

4) Determine the sunk costs related to the order.

5) Should Mr. Bourcier accept the order?