1. Star Company sells silver trays for $375

The costs of producing one tray follows:

Direct Material $200 Direct Labor $50

Variable manufacturing overhead$40

Fixed manufacturing overhead allocated $30 Variable selling and administrative costs $10

Fixed selling and administrative costs allocated $10

Star has received a special order for a retirement party. The customer would like to order 10 trays for $310 each The factory has enough capacity to accept this order.

The fixed manufacturing overhead and the fixed selling and administrative overhead would remain the same whether or not the special order was accepted.

Required: Should the order be accepted? Show your work.