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Safe Sailing manufactures otation vests in Charleston, South Carolina. Safe Sailing's contribution margin income statement for the most recent month contains the following data: @ (Click the icon to view the cost information.) Suppose Water Fun Cruiselines wants to buy 5,300 vests from Safe Sailing. Acceptance of the order will not require any variable selling and administrative expenses. The special order will not affect xed expenses. The Safe Sailing plant has enough unused capacity to manufacture the additional vests. Water Fun Cruiselines has offered $9 per vest, which is below the normal sale price of $14. Read the muirements. Requirement 1. Prepare an incremental analysis to determine whether Safe Sailing should accept this special sales order. (Enter a "0" for any zero balances. Use parentheses or a minus sign to indicate a negative contribution margin and/or a decrease in operating income from the special order.) Total Order Incremental Analysis of Special Sales Order Decision Per Unit (5,300 units) 47,700 Revenue from special order Less variable expense associated with the order: |_9l Variable manufacturing costs 5 w ll4 21,200 Contribution margin Less: Additional fixed expenses associated with the order 21,200 Increase (decrease) in operating income from the special order Data table -X A B Safe Sailing 2 Contribution Margin Income Statement (Variable Costing) 3 For Sales Volume of 32,000 Units 4 Total 5 Sales revenue $ 448,000 6 Less variable expenses: 7 Variable manufacturing costs (DM, DL, Variable MOH) 160,000 8 Variable operating expenses (selling and administrative) 103,000 9 Contribution margin $ 185,000 10 Less fixed expenses: 11 Fixed manufacturing overhead $ 123,000 12 Fixed operating expenses (selling and administrative) 90,000 13 Operating income (loss) $ (28,000)Requirements 1. Prepare an incremental analysis to determine whether Safe Sailing should accept this special sales order. 2. Identify long-term factors Safe Sailing should consider in deciding whether to accept the special sales order. Bucky Products, located in Orlando, Florida, produces two lines of electric After expansion, the factory will have a production capacity of 4,900 toothbrushes: Deluxe and Standard. Because Bucky can sell all the machine hours per month. The plant can manufacture either 56 toothbrushes it produces, the owners are expanding the plant. They are Standard electric toothbrushes or 22 Deluxe electric toothbrushes per deciding which product line to emphasize. To make this decision, they machine hour. assemble the following data: . Requirements @ (Click the icon to view the data.) 1. Identify the constraining factor for Bucky Products. 2. Prepare an analysis to show which product line to emphasize. Requirement 1. Identify the constraining factor for Bucky. Bucky's constraint is machine hours . Requirement 2. Prepare an analysis to show which product line to emphasize. Bucky Products Product Mix Analysis Deluxe Standard li Mil X Data table Per Unit Deluxe Standard Toothbrush Toothbrush Sales price . . . . . $ 90 $ 46 18 Variable expenses . . . . 22 Contribution margin . . . . $ 68 $ 28 Contribution margin ratio . . . . 75.6% 60.9%Modest Seating Company is currently selling 2,500 oversized bean bag chairs a month at a price of $70 per chair. The variable cost of each chair sold includes $40 to purchase the bean bag chairs from suppliers and a $9 sales commission. Fixed costs are $12,000 per month. The company is considering making several operational changes and wants to know how the change will impact its operating income. Read the @uirements. Requirement 1. Prepare the company's current contribution margin income statement. (Use parentheses or a minus sign for an operating loss.) Modest Seating Company Contribution Margin Income Statement Sales revenue 250,000 Variable expenses: Cost of goods sold 100,000 22,500 122,500 Operating expenses Contribution margin 127,500 Fixed expenses 12,000 Operating income (loss) 115,500 Requirements . Prepare the company's current contribution margin income statement. . Calculate the change in operating income that would result from implementing each of the following independent strategy alternatives. Compare each alternative to the current operating income as you calculated in Requirement 1. Consider each alternative separately. 0. d. Alternative 1: The company believes volume will increase by 16% if salespeople are paid a commission of 13% of the sales price rather than the current $9 per unit. Alternative 2: The company believes that spending an additional $4,000 on advertising would increase sales volume by 7%. Alternative 3: The company is considering raising the selling price to $75, but believes volume would drop by 20% as a result. Alternative 4: The company would like to source the product from domestic suppliers who charge $8 more for each unit. Management believes that the "Made in the USA" label would increase sales volume by 16% and would allow the company to increase the sales price by $14 per unit. In addition, the company would have to spend an additional $4,500 in marketing costs to get the word out to potential customers of this change