QUESTION 2: SPECIAL ORDER: OPPORTUNITY COSTS Choi Inc., is working at full production capacity producing 20,000 units of a unique product. Manufacturing costs per unit for the product are Direct materials Direct labor Manufacturing overhead Total manufacturing cast $9 $27 The unit manufacturing overhead cost is based on a $4 variable cost per unit and $120,000 of fixed costs. The nonmanufacturing costs, all variable, are $6 per unit, and the sales price is $45 per unit. Sports Headquarters Company (SHCI has asked Choi to produce 5,000 units of a modification af the new product. This modification would require the same manufacturing processes. SHC has offered to share the nonmanufacturing costs equally with Choi. Choi would sell the modified product to SHC for $30 per unit. REQUIRED 2. Should Chai produce the special order for SHC? Why or why not? Suppose that Choi Inc. had been working at less than full capacity to produce 16,000 units of the product when SHC made the offer. What is the minimum price that Choi should accept for the modified product under these conditions?