ABC Co. manufactures water fountains. ABC has the capacity…
ABC Co. manufactures water fountains. ABC has the capacity to manufacture and sell 80,000 water fountains each year but is currently only manufacturing and selling 60,000. The following per unit numbers relate to annual operations at 60,000 units: Per Unit Selling price $ 125 Manufacturing costs: Variable $ 28 Fixed $ 40 Selling and administrative costs: Variable $ 10 Fixed $ 12 UNF would like to purchase 3,000 water fountains from ABC but only if they can get them for $50 each. Variable selling and administrative costs on this special order will drop down from $10 per unit to $2 per unit. This special order will not affect the 60,000 regular sales and it will not affect the total fixed costs. The annual financial advantage (disadvantage) for ABC as a result of accepting this special order from UNF should be: