diamond corporation produces baseball bats for kids that it sells for $37 each at capacity the company can produce 54000 bats a year the costs of producing and selling 54000 bats are as follows:

cost per bat total costs

direct materials $14 $756000

variable direct manufacturing labour 4 216000

variable manufacturing overhead 2 108000

fixed manufacturing overhead 5 270000

variable selling expenses 2 108000

fixed selling expenses 3 162000

total cost $30 $1620000

required:

1) suppose diamond is currently producing and selling 44000 bats at this level of production and sales its fixed costs are the same as given in the preceding table . home run corporation wants to place a one-time special order for 10000 bats at $21 each diamond will incur no variable selling costs for this special order should diamond accept this one- time special order ^show your calculation.

2) now suppose diamond is currently producing and selling 54000 bats if diamond accepts home runs offer it will have to sell 10000 fewer bats to its regular customers. (a) on financial considerations alone should diamond accept this one - time special order? show your calculation (b) on financial considerations alone, at what price would diamond be indifferent between accepting the special order and continuing to sell to its regular customers at $37 per bat.(c) what other factors should diamond consider in deciding whether to accept the one-time special order?