Full explanation with formulas included

PART A: (10 MARKS) Power Drive produces a hard disk drive that sells for $ 140 per unit. The costs of producing 10,000 drives in the previous year were as follows: $ Direct material 500,000 Direct labour 300,000 Variable overhead 100,000 Fixed overhead 1,200,000 At the start of the current year, the company received an order for 2,000 drives from a computer company in China. Power Drive has mixed feelings about the order. On the one hand they welcome the order because they currently have excess capacity. Also, this is the company's first international order. On the other hand, the company in China is only willing to pay $ 100 per unit. REQUIRED: (a) Determine the net benefit (loss) to the company if the special order is accepted, stating any assumptions. (4 marks)