Luxed Construction Ltd (LCL) is a large manufacturing firm with two products in its product mix SP General and SP Special. LCL produces Component LMN that is used in the manufacture of both its products. LCLs 2018 books contain the following per unit cost of producing Component LMN:

Direct materials $ 149

Direct labor $ 131

Variable overhead $ 109

Fixed overhead $ 120

Total $509

Sydney Sussex Manufacturings (SSM) production manager approached LCL offering it a sale of 4100 Component LMN at a price of $461 each, a price less than the LCLs per unit in-house manufacturing cost of $509. If LCL management agrees to the offer, it will be able to avoid only 40% of its fixed overhead costs. The decision under consideration for LCLs management is whether to accept or reject SSMs offer.

Required: Showing all necessary calculations/steps, work out for LCL:

1. The relevant Variable costs, relevant Fixed costs and relevant Total costs for the decision under consideration at LCL.
2. LLCs production manager approached you as the companys management accountant asking you to evaluate SSMs offer and help him make a decision as to whether LLC should accept or reject SSMs offer. Show your calculations/working out on both the alternatives and suggest financially the best one to the production manager.
3. Briefly explain any four qualitative factors that LLC needs to take into consideration before opting for one of the two alterative under requirement A.