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Klean Fiber Company is the creator of Y-Go, a technology that weaves silver into its fabrics to kill bacteria and odor on clothing while
Klean Fiber Company is the creator of Y-Go, a technology that weaves silver into its fabrics to kill bacteria and odor on clothing while managing heat. Y-Go currently sells for $7.00 per undergarment. Y-Go has become very popular inundergarments for sports activities. Currently, at 70.00% production, Y-Go is producing 1,000,000 undergarments a year. The per unit costs for producing the undergarments is a such: Direct Materials: $2.00, Direct Labor: $0.75, Variable Manufacturing Overhead: $1.00, Fixed Manufacturing Overhead: $1.50, and Variable Selling Expenses: $0.25. The U.S. Army wants has an interest in purchasing 250,000 of these undergarments at a cost of $4.00 per unit, but this special order will create an additional $0.10 due to international shipping costs. Should Klean Fiber accept this special order from the U.S. Army, as this additional manufacturing of the 250,000 undergarments will not exceed the overall plant production of 100.00%? Using the appropriate template and complete the problem and answer the question. (check figure: original production net income = $1,500,000.00)
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