Collins Company makes a product that regularly sells for $15.50 per unit (Click the icon to view additional information.) 7. If Collins Company has excess capacity, should it accept the offer from Powell? Show your calculations. 8. Does your answer change if Collins Company is operating at capacity? Why or why not? 7. If Collins Company has excess capacity, should it accept the offer from Powell? Show your calculations. (Use a minus sign or parentheses to show a decrease in operating income.) Expected increase in revenue More Info - X Expected increase in variable manufacturing costs Expected increase/(decrease) in operating income Collins should the offer because operating income will 8. Does your answer change if Collins Company is operating at capacity? Why or why not? (Enter an expected decrease in revenue with a minus sign or parentheses.) The product has variable manufacturing costs of $10.50 per unit and fixed manufacturing costs of $1.70 per unit (based on $306,000 total fixed costs at current production of 180,000 units). Therefore, total production cost is $12.20 per unit. Collins Company receives an offer from Powell Company to purchase 5,200 units for $10.00 each. Selling and administrative costs and future sales will not be affected by the sale, and Collins does not expect any additional fixed costs. Revenue at capacity sale price Less: Revenue at regular sale price Expected increase/(decrease) in revenue Print Done Collins should the offer if operating at capacity because operating income will