Gruden Company produces golf discs which it normally sells to retailers for $7 each. The cost of manufacturing 21,700 golf discs is:

Materials		$ 10,416
Labor		31,899
Variable overhead		20,615
Fixed overhead		44,485
Total		$107,415

Gruden also incurs 7% sales commission ($0.48) on each disc sold. McGee Corporation offers Gruden $4.86 per disc for 5,480 discs. McGee would sell the discs under its own brand name in foreign markets not yet served by Gruden. If Gruden accepts the offer, its fixed overhead will increase from $44,485 to $49,795 due to the purchase of a new imprinting machine. No sales commission will result from the special order. (a) Prepare an incremental analysis for the special order.

(b) Should Gruden accept the special order?

Gruden Company producs gr discs which it normally bells to retailers far $7 exh. The co Haterials Labor varisble ovathesd 20,615 Fixed onertead cf manufatturing 21,700 golf dites/8: 10,416 Gruden also incurs 7% sales commission (s0.48)on each disc sold. McGee Corporation o ers Gruden 4.E6 per disc or 5 430 discs McGee would se ales comnission will resuilt from the spedial order. e discs under its own brand name in oreign markets not et served by Gruden f Gruden accepts the o e ts fixed overhead wil increase rom S44,485 to S 49, 735 due to te purenase of ne imp rting matine No repare n inaremente ays s or the special order. und answers to o decima p aces, e g. 5,275. Enter negative anoun s usang ether, negative sagn preceding the number e g 45 or parentheses e g 45 Reject Accept (Decrease) Materiel: Labor Varisble overheat Fixed overteed should Gruden accept the special order? Gruden should the special order