Case: The Dial Company specializes in producing a set of wood patio furniture consisting of a table and four chairs. The set enjoys great popularity, and the company has ample orders to keep production going at its full capacity of 3,000 sets per year. Annual cost data at full capacity follow:

The patio sets are normally sold for $120 per set. Dial can increase capacity by 1,000 units but must pay $25,000 to do so.

Annual cost data for the production of 3,000 sets are classified as follows:

For the following questions, please use the previous information to help support your decisions. Please document your answer in a clear, concise way and reference any numbers that were used to make your decision. Each question is independent and refers to the original data unless specified otherwise. For each question, please use up to 100 words.

1) Assume demand for 2020 is 2,000 units, what would be the minimum price that you would charge if you wanted to make a profit. Why is this the correct price? Please explain your calculations.

2) If demand for 2020 is instead 3,500 units should the company pay to increase their capacity? Why? Please explain your calculations. Assume units are sold at the normal price.

3) Assume demand is 2,990 units for 2020. If the company receives a special order for the next 10 units at $100 per set ($1,000 in total), would you accept this order? Why? Assume there is no better offer for the last ten units.

4) Assume demand can be 4,000 units in 2020 if the company pays to increase their capacity and if the company does additional online advertising that would cost $10,000. Assume the normal selling price of $120 per set. Would you advise the company to pay to increase capacity and pay for the additional online advertising? Why? Please explain your calculations.

5) Assume demand for 2020 is 3,100 units and you have decided that it is not worth it for Dial to expand production capacity. A competitor says that her company can supply you with 100 units for $10,000 and Dial can sell these units at the normal price. Will you advise Dial to take the offer and how does this compare to your own costs of making 100 additional units (do not consider the capacity expansion costs)?

Please help me! You don't even need to use 100 words for each question. I just want to understand how to solve them! Thank you so much!

$118,000 $50,000 $40,000 $3,500 $80,000 $2,500 $4,000 $12,000 $6,000 $10,000 $3,000 $60,000 $94,000 $20,000 Direct labor Advertising Factory supervision .. . Property taxes, factory building Sales commissions Insurance, factory Depreciation, administrative office equipment .. Lease cost, factory equipment... Indirect materials, factory Depreciation, factory building Administrative office supplies (billing) Administrative office salaries ... Direct materials used (wood, bolts, etc.) Utilities, factory .. Selling or Cost Behavior Product Cost Administrative Cost Item Variable Fixed Cost Direct Indirect $118,000 Direct labor $118,000 Advertising $50,000 S50,000 Factory supervision 40,000 $40,000 Property taxes, factory building 3,500 3,500 Sales commissions 80,000 80,000 Insurance, factory 2,500 2,500 Depreciation, administrative office equipment 4,000 4,000 Lease cost, factory equipment 12,000 12,000 Indirect materials, factory 6,000 6,000 Depreciation, factory building 10,000 10,000 Administrative office supplies 3,000 3,000 Administrative office salaries 60,000 60,000 94,000 94,000 Direct materials used 20.000 Utilities, factory 20.000 Total costs S94.000 $321.000 $i82.000 $197.000 $212.000