1. List and explain the elements of “churning.”
2. What are the four major elements of securities fraud?
3. What is the difference between horizontal and vertical price-fixing?
Capellen Manufacturing Corporation produces and sells quality wooden wall clocks that are priced at $340 each. Capellen has just received a request for a specia
l order for 1,500 clocks at a price of $215 each. The current unit cost to produce a clock is $210 (direct materials, $90; direct labor, $70; unitrelated overhead, $50). Capellen has the capacity to produce the special order; however, four additional production runs will be required costing $1,500 each. Should the order be accepted? Why or why not?