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Happy Scooter manufactures scooters used for urban transportation. It has the capacity to produce 5,000 scooters a year. The company currently produces and sells 4,000 scooters per year. Total Units sold 4,000 Revenue $24,000,000 Costs: Variable manufacuting cost 7,200,000 Fixed manufacturing cost 10,000,000 Variable SG&A cost 1,200,000 Fixed SG&A cost 800,000 Net Operating Income $4,800,000 Happy Scooter received a special order from the Orange Police Department. Information about the special order follows: - Quantity: 300 scooters - The police department will pay $5,200 per scooter - Happy will need to add storage space for the scooter's design. This will cause a one-time fixed cost of $90,000, but it will not affect the manufacturing cost of the scooters. - No sales commissions will be earned on these scooters, reducing the normal VSG&A cost by $75 per scooter. 9. Compute the amount by which Happy's operating income will change if it accepts the special order. 10. Compute the lowest price per scooter that Happy should be willing to accept for the special order. 11. Before Happy decides whether to accept the special order, a fire destroys part of its production facility. This reduces its production capacity to 4,200 scooters and is expected to last for one year. Compute the new lowest price Happy should be willing to accept for the special order.

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