Oriole Company produces golf discs, which it normally sells to retailers for $10 each. The cost of manufacturing 22,000 golf discs is: Materials Labour Variable overhead Fixed overhead Total $9,020 31,900 18,040 37,500 $96,460 Oriole also incurs 10% sales commission ($1.00) on each disc sold. Uli Corporation offers Oriole $8.00 per disc for 5,500 discs. Uli would sell the discs under its own brand name in foreign markets not yet served by Oriole. If Oriole accepts the offer, it will incur a one-time fixed cost of $5,800 due to the rental of an imprinting machine. No sales commission will result from the special order.

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