Problem 3 (25 points) Friendly Company produces a single product. Recently, the company received a special order from a large national public corporation that wants to purchase 900 units of the company's product at $110 each. Friendly Company's usual individual orders are no more than 25 units. So, this proposed 900-unit order is much larger than their usual order. The order will not affect the selling price to regular customers. Friendly Company's income statement for the past month is as follows: Sales Cost of goods sold Gross profit Selling and administrative expenses Net income Number of units sold $350,000 252,000 $98,000 30,000 $68,000 2,500 There was no beginning or ending inventories of work-in-process or finished goods. For the month presented, the company's detailed cost analysis is: Operating Cost Analysis Total Per unit $60,000 $24.00 72,000 28.80 120,000 48.00 $252,000 $100.80 30.000 $282,000 12.00 $112.80 Direct materials Direct labor Manufacturing overhead Total Production Cost Selling and administrative expenses Total Fixed manufacturing overhead is 45% of total manufacturing overhead and fixed selling and administrative expenses are 50% of that category. Required: a. Assuming the company has sufficient productive capacity to supply the special order and using a relevant cost approach, prepare an analysis of the relevant costs and revenues associated with the special order. Please show your work. b. Given the analysis above, should the company accept or reject the special order? Please explain your answer, briefly. c. Suggest 3 qualitative, i.e., non-financial, issues the company should consider when deciding on providing this special order. d. Assuming that 25% of the special order must be filled by eliminating sales to regular customers, use a relevant cost approach to determine the net financial advantage or disadvantage (profit increase or decrease) of accepting the order. Please show your work. e. Under the assumptions given in part d. and based on your analysis, do you recommend accepting or rejecting the special order? Please explain your answer, briefly.