Assume that a Belco's soup plant is running at 70% of its monthly capacity. Belco's has just received a special order to produce 215,000 cases of chicken noodle soup for a national supermarket. The supermarket will sell the soup under its own private brand label. The soup will be the same in all respects, except for the label, which will cost Belco's an extra $15,000 in total to design. The supermarket has offered to pay only $23.00 per case, which is well under Belco's normal sales price. Costs at the current production level (560,000 cases) are as follows:

Data Table Cost per Case Total Cost (560,000 cases) 6,160,000 $ 11.00 $ Direct Materials Direct Labor Variable MOH 1,120,000 2.00 6.00 3,360,000 4,480,000 8.00 Fixed MOH $ 15,120,000 $ 27.00 Total Print Done 1. Is there enough excess capacity to fill this order? If the plant is producing 560,000 cases a month, yet only operating at 70% of capacity, it must have a capacity level of cases per month. This means the plant has excess capacity of cases per month. there is enough capacity to fill this special order. 2. Will Belco's operating income increase or decrease if it accepts this special order? By how much? Complete the following incremental analysis to help you make your recommendation. (Use parentheses or a minus sign to indicate a decrease in operating income.) Total for order Per Unit (215,000 cases) Incremental Analysis of Special Order Revenue from special order (at special order price) Contribution margin from the special order Increase/(decrease) in operating income from the special order