Biology Forums - Study Force

Samson Incorporated provided the following information regarding its only product:

Sale price per unit   $50.00
Direct materials used   $160,000
Direct labor incurred   $185,000
Variable manufacturing overhead   $120,000
Variable selling and administrative expenses   $70,000
Fixed manufacturing overhead   $65,000
Fixed selling and administrative expenses   $12,000
Units produced and sold   20,000
   
Assume no beginning inventory   

Assuming there is excess capacity, what would be the effect on operating income of accepting a special order for 5,000 units at a sale price of $40 per product? (NOTE: Assume regular sales are not affected by the special order.)
A) Increase by $66,250
B) Increase by $333,750
C) Decrease by $66,250
D) Increase by $200,000

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Wow! Thank you

Thanks

thanks