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Alpine Luggage has a capacity to produce 410,000 suitcases per year. The company is currently producing and selling 330,000 units per year at a selling

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Alpine Luggage has a capacity to produce 410,000 suitcases per year. The company is currently producing and selling 330,000 units per year at a selling price of $395 per case. The cost of producing and selling one case follows: Variable manufacturing costs Fixed manufacturing costs Variable selling and administrative costs Fixed selling and administrative costs Total costs $ 163 39 83 19 $ 304 The company has received a special order for 20,000 suitcases at a price of $250 per case. It will not have to pay any sales commission on the special order, so the variable selling and administrative costs would be only $50 per suitcase. The special order would have no effect on total fixed costs. The company has rejected the offer based on the following computations: Selling price per case Variable manufacturing costs Fixed manufacturing costs Variable selling and administrative costs Fixed selling and administrative costs Net profit (loss) per case $ 250 163 39 50 19 $ (21) Required: a. What is the impact on profit for the year if Alpine accepts the special order? (Enter your answers in thousands of dollars. Select option "higher" or "lower", keepirig Status Quo as the base. Select "none" if there is no effect.) Answer is complete but not entirely correct. (All revenues and costs in 5000) Status Quo Alternative 330,000 Difference Units 350,000 Units $ 130,350,000 $ 135,350,000 higher 5,000,000 Sales revenue Variable costs: Manufacturing Selling and administrative Contribution margin Fixed costs Operating profit 53,790,000 57,050,000 3,260,000 higher 27,390,000 28,390,000 1,000,000 higher $ 49,170,000 $ 49,910,000 $ 740,000 higher 19,140,000 1,914,000 lower $ 30,030,000 $30,770,000 $ 740,000 higher

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