7) Domann Company produces a single product and has capacity to produce 240,000 units per month. Costs to produce its current monthly sales of 160,000 units follow. The normal selling price of the product is $50.00 per unit. A new customer offers to purchase 40,000 units for $37.50 per unit. If the special offer is accepted, there will be no additional fixed overhead and no additional fixed general and administrative costs. The special offer would not affect the company's normal sales. Direct materials Direct labor Variable overhead Fixed overhead Fixed general and administrative Totals Per Unit Costs at 160,000 Units $ 6.25 14.50 5.00 8.75 6.50 $ 1,000,000 2,320,000 800,000 1,400,000 1,040,000 $ 41.00 $ 6,560,000 Required: (1) Compute the income from the special offer. (2) Should the company accept the special offer?