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Waterway is the creator of Y-Go, a technology that weaves silver into fabrics to kill bacteria and odour on clothing while managing heat. Y-Go has

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Waterway is the creator of Y-Go, a technology that weaves silver into fabrics to kill bacteria and odour on clothing while managing heat. Y-Go has become very popular in undergarments for sports activities. Operating at capacity, the company can produce 1,000,000Y-Go undergarments each year. The per-unit and total costs for the undergarment are as follows: The Canadian Armed Forces (CAF) has approached Waterway and expressed an interest in purchasing 212.000 Y-Go undergarments for soldiers stationed in extremely warm climates. The CAF would pay the unit cost for direct materials, direct labour, and variable manufacturing overhead costs. In addition, the CAF has agreed to pay an additional $1 per undergarment to cover all other costs and provide a profit. Presently. Waterway is operating at 80% capacity and does not have any other potential buyers for Y-Ca if Waterway accepts the CAF's offer, it will not incur any variable selling expenses for this order. Assume Waterway can now sell 1,000,000 undergarments in the open market at $7 per unit. Using incremental analysik, determine whether Waterway should accept the CAF's offer for the 212,000 garments. Waterway should the CAF's offer

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