Wham Froducts, a maker of specality products, is currently manufacturing and selling a product called Gory Goo. A discount department store, J-Mart, has made a one-time offer to purchase 69,000 units of Cory Goo at $5,00 per unit for sale in J-Mart stores. Since Wham has enough excess capacity, management would naturally like to produce and self the additional units. But there is concem that $.00 is below Gory Goo's unit manufacutring costs and well below it's nocmal $8.54 selling price. Last vear. Gory Goo's unit wales were 380,000 and its total manufacturing costs were: In addition to the manufactuning costs, there were selling and administrotive expenses asseciated with Cory Geo. Variable selling and administrative expenses weie $1.50 per unic and fived selling and adminustrative espenset were $152,000. For the specal order, variable manutacturing costs per unit are expected to be the same at they nere last year, but because the special order units are being sold directly to the J. Mart chain, variable selling and adminigtrative expenses are eapected to be only $0.90 per whit. Fived costs will not be affected Even thaugh the specal orfer units Fill have a diferest name and packaging. Wham's marketing group stall believes that approximately 6 ,000 unita from the specal order a it be sold to elstomers who would noernally purchase Gory Geo from Wham