Delta Company produces a single product. The cost of producing and selling a single unit of this product at the company's normal activity level of 102,000 units per year is: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative expenses Fixed selling and administrative expenses $ 2.40 $ 2.00 $ 1.00 $ 4.45 $ 2.00 $ 1.00 The normal selling price is $22.00 per unit. The company's capacity is 127,200 units per year. An order has been received from a mail- order house for 2,100 units at a special price of $19.00 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 company's 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?

Delta Company produces a single product. The cost of producing and selling a single unit of this product at the company's normal activity level of 102,000 units per year is: The normal selling price is $22.00 per unit. The company's capacity is 127,200 units per year. An order has been received from a mailorder house for 2,100 units at a special price of $19.00 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 company's 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? Delta Company produces a single product. The cost of producing and selling a single unit of this product at the company's normal activity level of 102,000 units per year is: The normal selling price is $22.00 per unit. The company's capacity is 127,200 units per year. An order has been received from a mailorder house for 2,100 units at a special price of $19.00 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 company's 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