PA7-1 (Algo) Analyzing Special-Order Decision [LO 7-2, 7-3] Mohave Corporation makes several varieties of beach umbrellas and accessories. It has been approached by a company called Lost Mine Industries about producing a special order for a custom umbrella called the Ultimate Shade (US). The special-order umbrellas with the Lost Mine Company logo would be distributed to participants at an upcoming convention sponsored by Lost Mine. Lost Mine offered to buy 2,400 US umbrellas at a price of $20 each. Mohave currently has the excess capacity necessary to accept the offer. The following information is related to the production of the US umbrella: Direct materials $ 9.00 Direct labor 5.00 Variable manufacturing overhead 5.50 Fixed manufacturing overhead 2.50 Total cost $ 22.00 Regular sales price $ 28.00 Required: Compute the incremental profit (or loss) from accepting the special order. Should Mohave accept the special order? Suppose the special order had been to purchase 2,900 umbrellas for $17.00 each. Recompute the incremental profit (or loss) from accepting the special order under this scenario. Assume Mohave is operating at full capacity. Calculate the special-order price per unit at which Mohave would be indifferent between accepting or rejecting the special order.