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ProSports manufactures basketballs for professional basketball associations. It has budgeted the following sales and expenses for 2022 assuming the company is operates at 60% capacity.

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ProSports manufactures basketballs for professional basketball associations. It has budgeted the following sales and expenses for 2022 assuming the company is operates at 60% capacity. Full capacity is 150,000 units. Amount Per unit $50.00 Sales (90,000 units) "Cost of goods sold Selling and administrative expenses Net income $4,500,000 3,150,000 360,000 35.00 4.00 $990,000 $11.00 includes variable and fixed costs Fixed costs for the period are $900,000 for costs of goods sold and $162,000 for selling and administrative expenses Pro sports receives a special order for basketballs at $32 each from the European Basketball Association. Accepting the special order would increase variable selling and administrative expenses to $3.00 per unit because of shipping costs but would not increase fixed costs and expenses Consider each of the following independent situations: Show all your calculations, Consider each of the following independent situations: Show all your calculations. a) Assume the special order is for 20,000 units. i What is the minimum price Pro Sports should charge, in total, for this special order? If Pro Sports accepts this special order of 20,000 units at $30 per unit by how much will net income increase or decrease? Should Pro Sports accept the special order? iii. b) Assume the special order is for 70,000 units i What is the minimum price Pro Sports should charge, in total and per unit, for this special order? (hint compute the total price first) Should Pro Sports accept the special order? ii. ) Assume Pro Sports is operating at 100% and the special order is for 20,000 units. What is the minimum price Pro Sports should charge? Should Pro Sports accept the special order? Why? il

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