Star Ltd. collected the following information: Cost to buy one unit $48.00 Production costs per unit: Direct materials $22.00 Direct labour $16.00 Variable overhead $2.00 Total fixed overhead $360,000.00 Star Ltd. can sell 25,000 units (70% capacity) per year, at $80.00 each.

A. How much is the cost per unit to make?

Moon Corporation offers Star Ltd. $50.00 per unit for 5,000 unites. B. How much will be the incremental profit for the special order?

Moon Corporation was asking to put Moon logo offering $2.00 extra per unit. If Star accepts the offer, its fixed overhead will increase from $360,000.00 to $ 367,500.00 due to purchase a new machine for logo. C. How much will be the incremental profit for the special order with the logo? D. How much will be the cost to buy instead of making (ignore the special order)? The company also has an offer to rent its plant facilities for $250,000. The fixed overhead will be incurred in each alternative. E. How much Star Ltd. will earn extra profit if buy (ignore the special order)?

*Do we need to consider 70% capacity when we calculate above calculations?