Given the following data:
|
|
Total |
Per Unit |
|
Sales |
$30,000 |
$10 |
|
Less variable expenses |
18,000 |
6 |
|
Contribution margin |
12,000 |
$ 4 |
|
Less fixed expenses |
9,000 |
|
|
Net operating income |
$ 3,000 |
|
The company has an opportunity to secure a special order of 800 units if it is willing to drop the selling price on these units to $9. In addition to the usual variable expenses, the costs of securing the special order would be $1,000. The company”s regular sales would not be affected by the special order. If the special order is accepted, the company”s overall net operating income will:
A) increase $2,400
B) increase $1,400
C) increase $2,200
D) decrease $2,200