i Data Table air. pair. It has -m the specie Sho and 19 Direct materials $ 11 Variable direct manufacturing labor 35 Variable manufacturing overhead 10 Fixed manufacturing overhead allocated $ 75 Total manufacturing cost per unit The Acre Company has offered to sell 10,000 units of Part No. 498 to Chicago for $70 per unit. Chicago will make the decision to buy the part from Acre if there is an overall savings of at least $15,000 for Chicago. If Chicago accepts Acre's offer, $8 per unit of the fixed overhead allocated would be eliminated. Furthermore, Chicago has determined that the released facilities could be used to save relevant costs in the manufacture of Part No. 575. Print Done 1. The Lounge Company manufactures slippers and sells them at $9 a pair. Variable manufacturing cost is $4.75 a pair, and allocated fixed manufacturing cost is $2.00 a pair. It has enough idle capacity available to accept a one-time-only special order of 35,000 pairs of slippers at $6.75 a pair. Lounge will not incur any marketing costs as a result of the special order. What would the effect on operating income be if the special order could be accepted without affecting normal sales: (a) $0, (b) $70,000 increase, (c) $166,250 increase, or (d) $236,250 increase? Show your calculations. 2. The Chicago Company manufactures Part No. 498 for use in its production line. The manufacturing cost per unit for 10,000 units of Part No. 498 is as follows: (Click to see the manufacturing cost per unit.) Read part 2's requirement. 1. The Lounge Company manufactures slippers and sells them at $9 a pair. Variable manufacturing cost is $4.75 a pair, and allocated fixed manufacturing cost is $2.00 a pair. It has enough idle capacity available to accept a one-time-only special order of 35,000 pairs of slippers at $6.75 a pair. Lounge will not incur any marketing costs as a result of the special order. What would the effect on operating income be if the special order could be accepted without affecting normal sales: (a) $0, (b) $70,000 increase, (c) $166,250 increase, or (d) $236,250 increase? Show your calculations. Begin by selecting the labels to calculate the effect on operating income and then enter in the supporting calculations. * units in special order Effect on operating income