THis also contains 2 questions:

3rd Ques.)

4th ques.

TION 3 Relevant costs 15 marks sis marAsh aawry Company produces a single product. The cost of producing and selling a single unit ofthis product at the company's normal activity level of 100,ooo units per month is as 30.00 labor. 9.00 variable manufacturing overhead 3.00 Fixed manufacturing overhead Variable ng & administrative expense 15.00 2.00 Fixed selling & administrative expense The normal selling price of the product is s 85.00 per unit. An order has been received from an overseas customer for 15,000 units to be delivered this month at a special discounted price special order would have no effect on the company's normal sales and would not change the total amount of the company's fixed costs. The variable selling and administrative expense would be s o.so per unit on the special order. Required: the company is currently producing and selling 8o.ooo units and the special Suppose discounted price on the special order is s 40.50 per unit. If the special order is accepted how much will be the increase (decrease) in company's net income for the month? Should the special order be accepted at this price