Benjamin Company had the following results of operations for the past year:

Sales (18,000 units at $12)				$	216,000
Direct materials and direct labor	$	162,000
Overhead (20% variable)		18,000
Selling and administrative expenses (all fixed)		19,800			(199,800	)
Operating income				$	16,200

A foreign company (whose sales will not affect Benjamins market) offers to buy 4,500 units at $9.60 per unit. In addition to variable manufacturing costs, selling these units would increase fixed overhead by $860 and selling and administrative costs by $920. Assuming Benjamins productive capacity is 18,000 units per year and accepts the offer, its profits will:

Multiple Choice

• Decrease by $12,580.

• Increase by $ 9,020.

• Decrease by $ 5,400.

• Increase by $ 5,420.

• Decrease by $10,800.