Imperial Jewelers manufactures and sells a gold bracelet for $$189\mathrm{.}95.$ The company's accounting system says that the

unit product cost for this bracelet is $$149\mathrm{.}00$ as shown below:

The members of a wedding party have approached Imperial Jewelers about buying $20$ of these gold bracelets for the

discounted price of $$169\mathrm{.}95$ each. The members of the wedding party would like special filigree applied to the bracelets

that would increase the direct materials cost per bracelet by $$2\mathrm{.}00.$ Imperial Jewelers would also have to buy a special

tool for $$250$ to apply the filigree to the bracelets. The special tool would have no other use once the special order is

completed.

To analyze this special order opportunity, Imperial Jewelers has determined that most of its manufacturing overhead is

fixed and unaffected by variations in how much jewelry is produced in any given period. However, $$4\mathrm{.}00$ of the overhead

is variable with respect to the number of bracelets produced. The company also believes that accepting this order would

have no effect on its ability to produce and sell jewelry to other customers. Furthermore, the company could fulfill the

wedding party's order using its existing manufacturing capacity.

Required:

What is the financial advantage $($disadvantage$)$ of accepting the special order from the wedding party?

Should the company accept the special order?

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What is the financial advantage $($disadvantage$)$ of accepting the special order from the wedding party?