Rippey Corporation manufactures a single product with the following unit costs for 5,000 units:

Direct materials : $60 Direct labor : $30 Factory overhead (40% variable) : $90 Selling expenses (60% variable) : $30 Administrative expenses (20% variable): $15 Total per unit: $225

Recently, a company approached Rippey Corporation about buying 1,000 units for $225. Currently, the models are sold to dealers for $412.50. Rippey's capacity is sufficient to produce the extra 1,000 units. No additional selling expenses would be incurred on the special order.

Show calculations to answer

1-Determine the minimum price Rippey would want to receive in order to increase profits by $7,500 on the special order

2- Should Rippey accept the special order if its goal is to maximize short-run profits? How much will income be affected?