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Maribme manufactures flotation vests in Charlatie, North Carolina. Martime's contribution margin income statement for the most recent month contains the following data: '(Click the icon
Maribme manufactures flotation vests in Charlatie, North Carolina. Martime's contribution margin income statement for the most recent month contains the following data: '(Click the icon to view the cost information.) Suppose Optimum Cruiselines wants to buy 5,200 vests from Maritime. Acceptance of the order will not require any variable selling and administrative expenses. The special order will not atlect fiwed expenses. The Maritime plant has enough unused capachy to manubacture the addifonal vests. Optimum Cruiselines has offered $11 per vest, which is below the normal sale price of $16. Read the reouiremente 2. Requirement 1. Prepare an incremental analysis to determine whether Maritime should acoept this special sales order. (Enter a "O" for any zero balances. Use parentheses or a minus sign to indicate a negative contribution margin andior a decrease in operating income from the epecial order.) Decision: (1) Requirement 2. Identify lang-term factors Maritime should consider in deciding whether to acoept the special sales order. In addition to determining the special order's ellect on operating profits, Maritime's managers also should consider the following: A. Wil lowering the sale price tamish Maritime's image as a qualiby brand? B. Wil Maritime's other customers find out about the lower sale price Martime accepted from Optimum? If so, will these other customers demand lower eale prices? C. How will Martime's competitars react? Wil they retaliabe by cutting their prices and starting a price war? D. All of the above. E. None of the above. 1. Prepare an incremental analysis to determine whether Maritime should accept this special sales order. 2. Identity long-term factors Maritime should consider in deciding whether to accept the special sales order
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