minutes; 4 marks) Wheels Inc. produces a variety of electric scooters. Assume that Wheels has just received an order from a customer (Pulse Cycles) for 500 Power Core scooters. The following price, based on cost plus a 60% markup, has been developed for the order: Manufacturing costs Direct materials Direct labor $11,850 Factory Overhead 8,500 Total 15,800 Markup (60%) 36,150 Selling price 21,690 $57.480 Pulse Cycles rejected this price and offered to purchase the 500 scooters at a price of $45,000. The following additional information is available: Wheels has sufficient excess capacity to produce the scooters Factory Overhead is applied on the basis of direct labor dollars Budgeted factory overhead is $8,000,000 for the current year. Of this amount, $6,000,000 is fixed. Of the $15,800 of factory overhead assigned to the Pulse Cycles order, only $3,950 is driven by the special order, $11,850 is a fixed cost. elling and administrative expenses are budgeted as follows: ixed $3,000,000 per year $10 per unit manufactured and sold ariable equired a) The president of Wheels wants to know if he should allow Pulse Cycles to have the scooters for $45,000. Determine the impact on profits of accepting Pulse Cycles' offer. b) Assuming Wheels is operating at capacity and could sell the 500 scooters at its regular markup. In such case, should it accept (or not) the offer made by Pulse Cycles