Polaski Company manufactures and sells a single product called a Ret. Operating at capacity, the company can produce and sell 28,000 Rets per year. Costs associated with this level of production and sales are as follows: Unit Total Direct materials $1?.50 $ 490,000 Direct labour 10.50 294,000 Variable manufacturing overhead 5.50 154,000 Fixed manufacturing overhead 11.50 322,000 Variable selling expense 4.00 112,000 Fixed selling expense l5.00 158,000 Total cost $55.66 $1, 549,666 The Rets normally sell for $60 each. Fixed manufacturing overhead is constant at $322,000 per year within the range of18,000 through 28000 Rets per year. Required: 1. Assume that, due to a recession, Polaski Company expects to sell only 18,000 Rets through regular channels next year. A large retail chain has offered to purchase 10,000 Rets if Polaski is willing to accept a price lower than the regular $60. There would be no sales commissions on this order: thus, variable selling expenses would be slashed by 75%. However, Polaski Company would have to purchase a special machine to engrave the retail chain's name on the 10,000 units. This machine would cost $20,000. Polasl