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ShowBoat Corporation makes small sail boats that are sold to marine supply stores throughout the southeastern U.S. Recently, Joe Flynn, Sales Director, received a special
ShowBoat Corporation makes small sail boats that are sold to marine supply stores throughout the southeastern U.S. Recently, Joe Flynn, Sales Director, received a special order from a large boat retailer. The retail company offered to purchase 1, 000 boats at a price of $125 per boat. The largest order that ShowBoat has ever filled was for 50 boats, so this would be a significant order for the company. In consideration of the order, Joe Flynn obtained the following information from the company's cost accounting department: A. Prepare a schedule comparing the relevant revenue and costs associated with the special order. B. Given the analysis provided in step 1, would you accept the special order? C. If ShowBoat was operating at full production capacity before accepting the order, what might be the implications of that circumstance on your answer in step 2 above? D. What qualitative/business-related factors should be considered when making the final decision? E. Why don't companies, like ShowBoat, examine every order using the relevant cost framework
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