TIHER CALCULATOR PRINTER VERSION BACK ME e 155 09 Current Designs 7-1 (Part 1) a Current Designs faces a number of important decisions that require incremental analysis. Recently, Mike Cichanowski, owner and CEO of Current Designs, received a phone call from the president of a brewing company. He was calling to inquire about the possibility of Current Designs producing "floating coolers" for a promotion his company was planning. These coolers resemble a kayak but are about one-third the size. They are used to float food and beverages while paddling down the river on a weekend leisure trip. The company would be interested in purchasing 90 coolers for the upcoming summer. It is willing to pay $255 per cooler. The brewing company would pick up the coolers upon completion of the order Mike met with Dlane Buswell, controller, to identify how much it would cost Current Designs to produce the coolers. After careful analysis, the following conts were identitled. Direct materials $77 /unit Variable overhead $15 /unit Direct labor $57 /unit Fixed overhead $900 Current Designs would be able to modify an existing mold to produce the coolers. The cost of these modifications would be approximately $1,700. (a) Prepare an incremental analysis to determine wheth current Designs should accept this special order to produce the coolers. (Enter decrease in net income then enter with a negative sin preceding the number or parenthesis, .0.15.000 or (75.000).) Net Income Reject Order Accept Order Increase (Decrease) Revenues $ 0 22959 Costs 900 116010 -15110 tire $ 5 Net Income -900 8940 730 3 5 Current Designs should cott the order based on the incremental analysis