The Delmar Beverage Company produces a premium root beer that is sold throughout its chain of restaurants in the Midwest. The company is currently producing $1,958$ gallons of root beer per day, which represents $90\%$ of its manufacturing capacity. The root beer is available to restaurant customers by the mug, in bottles, or packaged in six$-$packs to take home. The selling price of a gallon of root beer averages $$14,$ and cost accounting records indicate the following manufacturing costs per gallon of root beer:

Raw materials $ $1\mathrm{.}06$

Direct labor $1\mathrm{.}67$

Variable overhead $1\mathrm{.}61$

Fixed overhead $1\mathrm{.}53$

Total absorption cost $ $5\mathrm{.}87$

In addition to the manufacturing costs just described, Delmar Beverage incurs an average cost of $$1\mathrm{.}05$ per gallon to distribute the root beer to its restaurants.

SaveMore Incorporated, a chain of grocery stores, is interested in selling the premium root beer in gallon jugs throughout its stores in the St$.$ Louis area during holiday periods and has offered to purchase root beer from Delmar Beverage at a price of $$11\mathrm{.}00$ per gallon. SaveMore believes it could sell $217$ gallons per day. If Delmar Beverage agrees to sell root beer to SaveMore, it estimates the average distribution cost will be $$1\mathrm{.}52$ per gallon.

Required:

Identify all the relevant costs that Delmar Beverage should consider in evaluating the special sales order from SaveMore?

How would Delmar Beverage$$s daily operating income be affected by the acceptance of this offer?

Assume that Delmar Beverage is currently producing $2,176$ gallons of root beer daily.

Identify all the relevant costs that Delmar Beverage should consider in evaluating the special sales order from SaveMore?

How would Delmar Beverage$$s daily operating income be affected by the acceptance of this offer?