Problem 11-22 Special Order Decisions [L011-4] Polaski Company manufactures and sells a single product called a Ret Operating at capacity, the company can produce and sel 38,000 Rets per year. Costs associated with this level of production and sales are given below Unit Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expense Fixed selling expense Total cost Totall 15 578,88 380,809 114,080 266,000 152,800 228,088 s 45 1,718,809 10 The Rets normally sell for $50 each. Fixed manufacturing overhead is $266.000 per year within the range of 31,000 through 38,000 Rets per year Required 1. Assume that due to a recession, Polaski Company expects to sell only 31 chain has offered to purchase 7000 Rets if Polaski is willing to accept a 16% discount off the regular price There would be no sales commissions on this order, thus, variable selling expenses would be slashed purchase a special machine to engrave the retail chain's name on the 7 has no assurance that the re accepting the special order? (Round your intermediate calculations to 2 decimal places,) .000 Rets through regular channels next year. A large retail by 75% However, Polaski Company would have to 000 units. This machine would cost $14,000. Polaski Company tall chain will purchase additional units in the future. What is the financial advantage (disadvantage) of 2. Refer to the original data. Assume again that Polaski Company expects to sell only 31,000 Rets through regular channels next year. of 7000 Rets. The Army would pay a fixed fee of $1.80 per Ret, and it ariable selling expenses associated with this order. What is the financial d reimburse Polaski Company for all costs of production (variable and fixed) associated with the units. Because the army would pick up the Rets with its own trucks, there would be no v advantage (disadvantage) of accepting the U.S. Army's special order? described in (2) above. except that the company expects to sell 38,000 Rets through regular channels order would require giving up regular sales of 7.000 Rets. Given this new information, what next year. Thus, accepting the U.S. Arm y's is the financial advantage (disadvantage) of accepting the US. Army's special order