Blueberry Company produces and sells 50,000 jars of jam each year. The following information reflects a breakdown of its costs:

Cost Item	Costs per Jar	Total Costs
Variable production costs	$10	$500,000
Fixed production costs	$6	$300,000
Variable selling costs	$4	$200,000
Fixed selling and administrative costs	$2	$100,000
Total costs	$22	$1,100,000

Blueberry marks up its prices 50% over full costs. It has surplus capacity to produce 20,000 more jars. A Canadian supermarket company has offered to purchase 12,000 jars of the product at a special price of $28 per jar. Blueberry will incur additional shipping and selling costs of $2 per jar to complete this order.

Required: (a) What will be the effect on Blueberry's operating income if it accepts this order? (b) Prepare an incremental analysis for the decision.