Toy Sellers makes badminton sets. Each set sells for $52. Variable manufacturing costs are $28 per unit. Fixed manufacturing costs are $25,000. Variable and fixed nonmanufacturing costs are $3 per unit and $5,000, respectively. Sportsplex has approached Toy Sellers and offered to buy 500 badminton sets for $35 each. Currently, production and sales are 2,000 units with a total plant capacity of 2,400 units. Management feels as though it should not accept the offer since the current manufacturing cost per unit is $40.50.

Using the attached Excel file, answer the following two questions. You will need to save the file first to a destination of your choice (hard drive, flash drive, etc.) Make sure that you attach your completed file before you finish the test.

A. Should Toy Sellers accept Sportsplexs offer? Provide support for your conclusion.

B. If Toy Sellers accepts Sportplexs offer and produces the badminton sets, how much profit/loss will Toy Sellers incur?