(1).Excess capacity of production shall not consider the fixed as it is not relevant cost as it is a sunk cost.
Sales price per unit = $0.33
Less:- Direct material = -$0.13
Direct labor = -$0.04
Variable overhead = -$0.11
Differencial amount per unit = $0.05
Units sold = 55,000
Differencial income = $2,750
(2). The amount spent on the development of hologram to be reused is not a relevant cost for decision making. Hence the differential revenue remains the same at $2,750. Shall be still sold.