Davis Company makes a product that regularly sells for $14.00 per unit. (Click the icon to view additional information.) 7. It Davis Company has excess capacity should it accept the ofler trom Wellinglon? Show your calculations. 8. Does your answer change if Davis Company is operating at capacity? Why or why not? 7. If Davis Company has excess capacity, should it accept the ofler from Welington? Show your calculations. (Use a Davis should the offer because cperating income will B. Does your answer change if Davis Company is operating at capacity? Why or why not? (Enter an oxpected decres Davis should the oftor it operating at capacity because cperasing income wal Jany has excess capacity, should it accept the offer from Wellington? Show your calculations. swer change if Davis Company is operating at capacity? Why or why not? More info The product has variable manufacturing costs of $8.00 per unit and fixed manufacturing costs of $1.90 per unit (based on $247,000 total fixed costs at current production of 130,000 units). Therefore, total production cost is $9.90 per unit. Davis Company receives an offer from Wellington Company to purchase 4,500 units for $7.50 each. Selling and administrative costs and future sales will not be affected by the sale, and Davis does not expect any additional fixed costs