Question 3 Reno Company manufactures toaster ovens. For the first 8 months of 2020, the company reported the following operating results while operating at 95% of plant capacity: Sales revenue (361,000 units) 4,512,500 Cost of goods sold 2,346,500 Gross profit 2,166,000 Operating expenses 866,400 Net income 1 299,600 The Question Continues TURN OVER 2 3 Cost of goods sold was 80% variable and 20% fixed: operating expenses were 75% variable and 25% fixed. In September, Reno Company receives a special order for 15,000 toasters at 7.60 each from Company B. Acceptance of the order would result in an additional 4,000 of shipping costs but no increase in fixed operating expenses. Required: a) Prepare an incremental analysis for the special order and state whether the company should accept it. (40%) b) Would your answer change if the order was for 20,000 units? Show computations. (40%) c) Briefly discuss the possible qualitative factors you would take into consideration before making a final decision on whether to accept or reject the order. (20%)