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Pardo Company produces a single product and has capacity to produce 165,000 units per month. Costs to produce its current monthly sales of 132.000 units

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Pardo Company produces a single product and has capacity to produce 165,000 units per month. Costs to produce its current monthly sales of 132.000 units follow. The normal selling price of the product is $100 per unit. A new customer offers to purchase 33.000 units for $65.70 per unit. If the special offer is accepted, there will be no additional fixed overhead and no additional fixed general and administrative costs. The special offer would not affect its normal sales. Direct materials Direct labor Variable overhead Fixed overhead Fixed general and administrative Totals Per Unit $ 12.50 15.00 14.00 17.50 14.00 $ 73.00 Costs at 132,000 Units $1,650,000 1,980,000 1,848,000 2,310,000 1,848,000 $ 9,636,000 (a) Compute the income from the special offer. (b) Should the company accept the special offer? Complete this question by entering your answers in the tabs below. Required A Required B Compute the income for the special offer. (Round your "Per Unit" answers to 2 decimal places.) SPECIAL OFFER ANALYSIS Per Unit Total Variable costs Contribution margin Fixed costs Fixed overhead Fixed general and administrative Income (Required A Required B > Pardo Company produces a single product and has capacity to produce 165,000 units per month. Costs to produce its current monthly sales of 132,000 units follow. The nomal selling price of the product is $100 per unit. A new customer offers to purchase 33,000 units for $65.70 per unit. If the special offer is accepted, there will be no additional fixed overhead and no additional fixed general and administrative costs. The special offer would not affect its normal sales. Per Unit Costs at 132,000 Units Direct materials S 12.50 S $1,650,000 Direct labor 15,00 1,980,000 Variable overhead 14.00 1,848,000 Fixed overhead 17.50 2,310,000 Fixed general and administrative 14.00 1,848,000 Totals $ 73,00 $ 9,636,000 (a) Compute the income from the special offer. (b) Should the company accept the special offer? Complete this question by entering your answers in the tabs below. Required A Required B Should the company accept the special offer? Should the company accept the special offer?

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