Easton Company has a capacity to produce 200,000 computer monitors per year. The company is currently producing and selling 160,000 monitors per year at a selling price of $400 per monitor. The cost of producing and selling one monitor at the 160,000 unit level of activity is given in the table below:
Direct Material cost	$ 100
Direct Labor cost	$ 40
Variable manufacturing cost	$ 20
Fixed manufacturing cost	$ 40
Variable selling and administrative cost (includes sales commission of $30 per unit)	$ 80
Fixed selling and administrative cost	$ 20
Total cost per unit	$ 300

The company has received a special order for 10,000 monitors at a unit price of $250. The company does not have to pay sales commission to the salesmen for the special order. Currently, the company pays a sales commission of $30 per monitor to its salesmen. The special order will have no effect on its fixed costs. The marketing manager has rejected the special order based on the following computation:
Special order price		$ 250
Cost per monitor	$ 300
Less: sales commission avoided	$ 30
Cost per monitor for the special order		$ 270
Net loss per monitor for the special order		$ (20)

Problem (Please provide steps) a) You are reviewing the marketing manager's decision. What would you do? Would you accept or reject the order? Show computations to support your decision, especially the impact on company's profits from the special order. (4 points) b) Regardless of what you answered in part (a), what is the minimum acceptable price for the special order? (2 points) c) Suppose the firm is selling 195,000 monitors currently. If the company wants to accept the special order, what is the minimum acceptable price? Assume that the cost structure given for an actitivy level of 160,000 monitors is applicable at this level of activity as well. (4 points)

SCreen shot of problem

Easton Company has a capacity to produce 200,000 computer monitors per year. The company is currently producing and selling 160,000 monitors per year at a selling price of $400 per monitor. The cost of producing and selling one monitor at the 160,000 unit level of activity is given in the table below: The company has received a special order for 10,000 monitors at a unit price of $250. The company does not have to pay sales commission to the salesmen for the special order. Currently, the company pays a sales commission of $30 per monitor to its salesmen. The special order will have no effect on its fixed costs. The marketing manager has rejected the special order based on the following computation: a) You are reviewing the marketing manager's decision. What would you do? Would you accept or reject the order? Show computations to support your decision, especially the impact on company's profits from the special order. (4 points) b) Regardless of what you answered in part (a), what is the minimum acceptable price for the special order? (2 points) c) Suppose the firm is selling 195,000 monitors currently. If the company wants to accept the special order, what is the minimum acceptable price? Assume that the cost structure given for an actitivy level of 160,000 monitors is applicable at this level of activity as well. (4 points)