Walton Company, which produces and sells a small digital clock, bases its pricing strategy on a 25 percent markup on total cost. Based on annual production costs for 15,000 units of product, computations for the sales price per clock follow.

Unit-level costs	$	330,000
Fixed costs		78,000
Total cost (a)		408,000
Markup (a 0.25)		102,000
Total sales (b)	$	510,000
Sales price per unit (b 15,000)	$	34

Required

Walton has excess capacity and receives a special order for 4,000 clocks for $25 each. Calculate the contribution margin per unit. Based on this, should Walton accept the special order?

Prepare a contribution margin income statement for the special order.

Walton has excess capacity and receives a special order for 4,000 clocks for $25 each. Calculate the contribution margin per unit. Based on this, should Walton accept the special order? Prepare a contribution margin income statement for the special order