Problem 3 Bimagsak Company manufactures a product with the following costs per unit at the expected production level of 84,000 units: Direct materials P12 Direct labor 36 18 Variable manufacturing overhead Fixed manufacturing overhead 24 The company has the capacity to produce 90,000 units. The product regularly sells for P120. Required: Answer the following independent cases. 1. A wholesaler has offered to pay P110 a unit for 7,500 units. If the special order is accepted, what is the effect on operating income? Should the order be accepted? 2. If a wholesaler offered to buy 4,500 units for P100 each, what is the effect of the special order on income? Should the order be accepted