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7. The Alfa Specialty Engineering Company (SPEC) is opening for business. The shop sells various types of unique hydraulic system replacement parts. · A system engineering firm has offered to buy 1,500 specialty items for $10,000. Fixed costs for one month = $4,000 SPEC has priced the items at $8.00 each variable cost per item = $6.00 . Questions: a. b. c. d. Calculate SPECs operating breakeven point Calculate SPECs EBIT on the order If SPEC renegotiates the contract at a price of $ 10.00 per item, what will the EBIT be? If the systems engineering firm refuses to pay more than $ 8.00 per unit but is willing to negotiate quantity, what quantity of items will result in an EBIT of $ 4,000?

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