Paul Krass finds it difficult sleeping at night thinking of the relationship and manage- ment issues between his co-director and his recently hired college friend. In less than a
month, Paul's friend is contemplating tendering his immediate resignation, whereas his
co-director wonders why Paul ever suggested the hiring. Paul knew that there would
be some personality differences initially to overcome, but thought that in time the two
would complement each other's managing style. The situation seems to have come to
a boiling point, and Paul is in the middle counseling his friend one minute and his co-
director the other. He knows that both managers are valuable to the company and feels
that he must help to identify the problems and preventative solutions so that he helps to
retain the
managers
and their friendship.

Special order carson manufacturing, inc., sells a single product for $36 per unit. at an operating level of 8,000 units, variable costs are $18 per unit and fixed costs $10 per unit. carson has been offered a price of $20 per unit on a special order of 2,000 units by big mart discount stores, which would use its own brand name on the item. if carson accepts the order, material cost will be $3 less per unit than for regular production. however, special stamping equipment costing $4,000 would be needed to process the order; the equipment would then be discarded. assuming that volume remains within the relevant range, prepare an analysis of differential revenue and costs to determine whether carson should accept the special order. use a negative sign with answer to only indicate an income loss from special order; otherwise do not use negative signs with your answers.