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Sail On manufactures flotation vests in Charleston, South Carolina. Sail On's contribution margin income statement for the month ended Suppose Overtown wishes to buy 4,500
Sail On manufactures flotation vests in Charleston, South Carolina. Sail On's contribution margin income statement for the month ended Suppose Overtown wishes to buy 4,500 vests from Sail On. Sail On will not incur any variable selling and administrative expenses on the special December 31,2024 , contains the following data: order. The Sail On plant has enough unused capacity to manufacture the additional vests. Overtown has offered $8 per vest, which is below the (Click the icon to view the cost information.) Read the requirements. Requirement 1. Identify each cost in the income statement as either relevant or irrelevant to Sail On's decision. Data table Requirement 2. Prepare a differential analysis to determine whether Sail On should accept this special sales order. (Enter decreases to revenue or increases to costs with a parentheses or minus sign.) vecision: Requirement 3. Identify long-term factors Sail On should consider in deciding whether to accept the special sales order. In addition to determining the special order's effect on operating profits, Sail On's managers also should consider the following: A. Will the special order customer come back again and again, asking for the same reduced price? B. How will Sail On's competitors react? Will they retaliate by cutting their prices and starting a price war? C. Will Sail On's other customers find out about the lower sale price Sail On accepted from Overtown? If so, will these other customers demand lower sale prices? D. All of the above E. None of the above
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