In 2020 Della Valle Inc. has been contacted by a major retailer regarding a special order of 15,000 of the Smash hit and 5,000 of the Hogan models at a selling price of $55 for Smash Hit and $125 for Hogan. In deciding whether or not to accept these special orders you need to consider the following: You can only accept an order in full you cannot take part orders of both. The forecast unit sales for 2020 is the following:

Della Valle Footwear is operating at 80 percent of total capacity.

• The cost of the rubber sole is expected to increase by 20% per unit cost in 2020. The cost of Della Valle rent is expected to increase by $2 per unit cost in 2020. All the other costs are estimated to be at the same level of 2019.

Based on the above:

1. Perform an incremental analysis of each order.
2. Can Della Valle Footwear fulfill both orders as requested by the customer? Should Della Valle reject one of the orders?

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