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Question - Missoula Industries manufactures a product with the following costs per unit at the expected production of 30,000 units:
Direct materials $5
Direct labor $15
Variable manufacturing overhead $8
Fixed manufacturing overhead $6
The company has the capacity to produce 60,000 units. The product regularly sells for $45. A new potential customer has offered to purchase 2,000 units for $40 each.
Required -
a. What is the effect on net income, if Missoula Industries accepts the special order?
b. List 2 QUALITATIVE items that should be considered beyond the computational analysis. Be concise, please.
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