The Gannett Company provides landscaping services to corporations and businesses. All its landscaping work requires Gannett to use landscaping equipment. Its landscaping equipment has the capacity to do 12,500 hours of landscaping work. It currently anticipates getting orders that would utilize 11,700 hours of equipment time from existing customers. Gannett charges $120 per hour for landscaping work. Cost information for the current expected activity level is as follows: (Click the icon to view the cost information.) Read the requirement. Tder, and then determine Begin by completing an analysis, and start by showing the comput whether Gannett should accept or reject the special order. * Data Table Without One-Time Only Special Order Relevant revenues 1,404,000 795,600 Relevant variable costs: Landscaping costs Revenues ($120 x 11,700 hours) Variable landscaping costs (including materials and labor), which vary with the number of hours worked ($68 per hour x 11,700 hours) Fixed landscaping costs Variable marketing costs (4% of revenues) Fixed marketing costs Total costs Marketing costs Total relevant costs Relevant operating income 105,000 56,160 65,000 1,021,760 382,240 $ Operating income Requirement Print Done Gannett has received an order for landscaping work from Pamela Corporation at $55 per hour that would require 2,200 hours of equipment time. Variable landscaping costs for the Pamela Corporation order are $68 per hour and variable marketing costs are 4% of revenues. Gannett can either accept the Pamela offer in whole or reject it. Should Gannett accept the offer? Print Done Clear All Check