pter 11. Homework 6 Polaski Company manufactures and sells a single product called a Ret Operating at capacity, the company can produce and sell 40,000 Rets per year. Costs associated with this level of production and sales are given below Direct materialts Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expense Fixed selling expense Total cost $15 % 60e,600 328,008 120,0e8 280,80 80,000 240,869 Book Print erences 41 1,640,e00 The Rets normally sell for $46 eac Rets per year h. Fixed manufacturing overhead is $280,000 per year within the range of 33,000 through 40,000 Required: Polaski Company expects to sell only 33,000 Rets through regular channels next year A large retail Rets if Polaski is willing to accept a 16% discount off the regular price. There would be no sales chain has offeredto purchase 7000 commissions on this order, thus, variable selling expenses would purchase a special machine to engrave the retail chain's name on the 7000 units. This machine would cost $14 has no assurance that the retail chain will purchase additional units in the future. What accepting the special order? (Round your intermediate calculations to 2 decimal places.) be slash hed by 7 aski Company would have to ,000. Polaski Company is the financial advantage (disadvantage) of 2. Refer to the original data. Assume again that Pol The U.S. Army would like to make a one-time-only purchase of 7,000 Rets. The Army would pay a fixed fee of $1.60 per Ret, would reimburse Polaski Company for all costs of production (variable and fixed) associated with the units. Because the pick up the Rets with its own trucks, no variable sell advantage (disadvantage) of accepting the U.S. Army's special order? aski Company expects to sell only 33,000 Rets through regular channels next year and it s, there would be no variable selling expenses associated with this order. What is the financial ssume the same situation as described in (2) above, except that the company expects to sell 40,000 Rets through regular channels next year Thus, accepting the U.S. Army's order would require giving up regular sales of 7,000 Rets. Given this new information, what is the financial advantage (disadvantage) of accepting the US. Army's special order?