💡 When evaluating a special pricing order, the key consideration is whether the incremental revenue from the order exceeds the incremental (variable) costs. Selling price per unit (special offer): $7 Variable manufacturing cost per unit: $5 Fixed manufacturing cost per unit: $3 (However, fixed costs are not considered in short-term decision-making if they do not change.) Contribution margin per unit: $7 - $5 = $2 profit per unit Since the special price covers variable costs and provides a positive contribution margin, the manufacturer can accept the offer if no additional fixed costs (such as expanding facilities) are incurred.