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Pharoah Company produces golf discs which it normally sells to retailers for $6 each. The cost of manufacturing 25,000 golf discs is: Pharoah also incurs
Pharoah Company produces golf discs which it normally sells to retailers for $6 each. The cost of manufacturing 25,000 golf discs is: Pharoah also incurs 5% sales commission (\$0.30) on each disc sold. Rudd Corporation offers Pharoah $4.30 per disc for 2,700 discs. Rudd would sell the discs under its own brand name in foreign markets not served by Pharoah. If Pharoah accepts the offer. its fixed overhead will increase from $36,000 to $38,700 due to the purchase of a new imprinting machine. No sales commission will result from the special order. Prepare an incremental analysis for the special order. (Enter negative amounts using either a negative sign preceding the number e.g. 45 or parentheses eg. (45). Do not leave any field blank. Enter 0 for the amounts.) Should Pharoah accept the special order? Pharoah accept the special order
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