Delta Company produces a single product. The cost of producing and selling a single unit of this product at the companys normal activity level of 90,000 units per year is:

Direct materials	$ 2.50
Direct labor	$ 3.00
Variable manufacturing overhead	$ 1.00
Fixed manufacturing overhead	$ 4.85
Variable selling and administrative expenses	$ 1.90
Fixed selling and administrative expenses	$ 2.00

The normal selling price is $25.00 per unit. The companys capacity is 120,000 units per year. An order has been received from a mail-order house for 2,500 units at a special price of $22.00 per unit. This order would not affect regular sales or total fixed costs.

Required:

1. What is the financial advantage (disadvantage) of accepting the special order?
2. As a separate matter from the special order, assume the companys inventory includes 1,000 units that are inferior quality. The units must be sold through regular channels at a reduced price. The company does not expect the selling of these inferior units to affect regular sales. What unit cost is relevant for establishing a minimum selling price for the inferior units?