Special Order

Carson Manufacturing, Inc, sells a single product for $$33$ per unit. At an operating level of $8,000$ units, variable costs are $$18$ per unit and fixed costs $$10$ per unit.

Carson has been offered a price of $$17$ per unit on a special order of $2,000$ units by Big Mart Discount Stores, which would use its own brand name on the item. If Carson accepts the order, material cost will be $$4$ less per unit than for regular production. However, special stamping equipment costing $$3,000$ would be needed to process the order; the equipment would then be discarded.

Assuming that volume remains within the relevant range, prepare an analysis of differential revenue and costs to determine whether C$$rson should accept the special order.

Use a negative sign with answer to only indicate a loss from special order; otherwise do not use negative signs with your answers.

$\backslash$table$[[$Special Order Differential Analysis$],[$Differential revenue$],[$Differential variable costs$],[$Equipment cost$],[$Additional income $($loss$)$ from special order $