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Fifteen Spatulas is a manufacturer of soup and rotates through fifteen different flavors of soup during a year. Currently, the company is operating at 90%

Fifteen Spatulas is a manufacturer of soup and rotates through fifteen different flavors of soup during a year. Currently, the company is operating at 90% of its full capacity and is producing butternut squash bisque. The company just received a special order to produce 200 cases of the bisque for a national grocery store chain. The bisque will be sold under the grocery store chain's private label. The bisque will be the same in all respects, excpet for the label, which will cost Fifteen Spatulas an extra $250 to design. The grocery store chain has offered to pay $19.00 per case to Fifteen Spatulas, which is $10.00 less than what it charges to its regular customers. Total production costs at the current production level of 4,500 cases is as follows: Total Cost Direct materials $45,000 Direct labor 13,500 Variable MOH 9,000 Fixed MOH 27,000 Total $94,500 Which of the following statements is correct? A. The contribution margin percentage on the special order is less than the contribution margin on regular sales. B. Operating income will increase if the special order is accepted. C. Acceptance of the special order will not affect the company's ability to fill its regular sales. D. The company should consider the impact of the special order on its reputation in the market. E. All of the above statements are correct

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