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Davis Kitchen Supply produces stoves for commercial kitchens. The costs to manufacture and market the stoves at the company's normal volume of 6.000 units per month are shown in the following table 552 62 It wanufacturing costs Variable sterlas Variable labor Variable overhead Fixed overhead Total unit manufacturing costs Unit wing costs Variable Fived Total unit marketing costs Total unit costs 32 Unless otherwise stated, assume that no connection exists between the situation described in each question cach is independent Unless otherwise stated, assume a regular selling price of 5384 per unit ignore income taxes and other costs that are not mentioned in the table or in the question itselt Required: Market research estimates that volume could be increased to 7000 unts which is well within production capacity to the price were cut from $384 to $339 per unit Assuming that the cost behavior patterns implied by the data in the table are correct - 1. What would be the impact on monthly sales costs, and income -2. Would you recommend taking this action? b. on March 1, the federal government offers Davis a contract to supply t000 units to military bases for Mac 31 delivery Because of an unusually large number of ruth orders from its regular customers. Davis plans to produce 8.000 unts during March which all available capacity fit accepts the government order it would lose 1000 units normally sold to regular customers to como The government contract would reimburse its share of March manufacturing costs' plus pay $48000 seed fee on marketing costs would be incurred on the government's units) Assuming that the government share of March manufacturing com will be the proportionate fed manufacturing cost wat impact would accepting the government contract have on Match core? c. Davis has an opportunity to enter a highly competitive foreign market an attraction of the foreign mishan demos greatest when the domestie market demandis quite low.thus de production could be used business An order for 2.000 units being sought to below.ome to enter this market for the Davis Kitchen Supply produces stoves for commercial kitchens. The costs to manufacture and market the stoves at the company's normal volume of 6.000 units per month are shown in the following table 552 62 It wanufacturing costs Variable sterlas Variable labor Variable overhead Fixed overhead Total unit manufacturing costs Unit wing costs Variable Fived Total unit marketing costs Total unit costs 32 Unless otherwise stated, assume that no connection exists between the situation described in each question cach is independent Unless otherwise stated, assume a regular selling price of 5384 per unit ignore income taxes and other costs that are not mentioned in the table or in the question itselt Required: Market research estimates that volume could be increased to 7000 unts which is well within production capacity to the price were cut from $384 to $339 per unit Assuming that the cost behavior patterns implied by the data in the table are correct - 1. What would be the impact on monthly sales costs, and income -2. Would you recommend taking this action? b. on March 1, the federal government offers Davis a contract to supply t000 units to military bases for Mac 31 delivery Because of an unusually large number of ruth orders from its regular customers. Davis plans to produce 8.000 unts during March which all available capacity fit accepts the government order it would lose 1000 units normally sold to regular customers to como The government contract would reimburse its share of March manufacturing costs' plus pay $48000 seed fee on marketing costs would be incurred on the government's units) Assuming that the government share of March manufacturing com will be the proportionate fed manufacturing cost wat impact would accepting the government contract have on Match core? c. Davis has an opportunity to enter a highly competitive foreign market an attraction of the foreign mishan demos greatest when the domestie market demandis quite low.thus de production could be used business An order for 2.000 units being sought to below.ome to enter this market for the