Exercise 12-2 Your answer is partially correct. Try again. Cheyenne Company produces golf discs which it normally sells to retailers for $7 each. The cost of manufacturing 17,000 golf discs is: Materials Labor Variable overhead Fixed overhead Total $9,180 24,990 17,850 34,340 $86,360 Cheyenne also incurs 6% sales commission ($0.42) on each disc sold. McGee Corporation offers Cheyenne $4.95 per disc for 5,570 discs. McGee would sell the discs under its own brand name in foreign markets not yet served by Cheyenne. If Cheyenne accepts the offer, its fixed overhead will increase from $34,340 to $38,930 due to the purchase of a new imprinting machine. No sales commission will result from the special order