Suppose the Hockey Hall of Fame in Toronto has approached Active-Cardz with a special order. The Hall of Fame wants to purchase 57,000 hockey card packs for a special promotional campaign and offers $0.43 per pack, a total of $24,510. Active-Cardz's total production cost is $0.55 per pack, as follows: (Click the icon to view the cost information.) Active-Cardz has enough excess capacity to handle the special order. Requirements Requirement 1. Prepare an incremental analysis to determine whether Active-Cardz should accept the special sales order assuming fixed costs would not be affected by the special order. (Use parentheses or a minus sign to enter a decrease in operating income.) Active-Cardz ? Cost information Requirements Incremental Analysis of Special Sales Order Expected increase in revenues Expected increase in expenses: Variable costs: Variable manufacturing costs Direct materials $ 0.12 1. Prepare an incremental analysis to determine whether Active-Cardz should accept the special sales order assuming fixed costs would not be affected by the special order. 2. Now assume that the Hall of Fame wants special hologram hockey cards. Active-Cardz must spend $1,800 to develop this hologram, which will be useless after the special order is completed. Should Active-Cardz accept the special order under these circumstances? Show your analysis. Fixed mar costs Direct labour 0.06 0.14 Total expected increase in expenses Variable overhead 0.23 Fixed overhead Expected increase (decrease) in operating income $ 0.55 Total cost .. Print Done Print Done

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