Buoy manufactures flotation vests in San Diego, California. Buoy's contribution margin income statement for the most recent month contains the following data: (Click the icon to view the cost information.) Suppose Overton Cruiselines wants to buy 5,200 vests from Buoy. Acceptance of the order will not increase Buoy's variable marketing and administrative expenses or any of its fixed expenses. The Buoy plant has enough unused capacity to manufacture the additional vests. Overton Cruiselines has offered $10 per vest, which is below the normal sale price of $15. Read the requirements. Requirement 1. Prepare an incremental analysis to determine whether Buoy should accept this special sales order. (Enter a "0" for any zero balances. Use parentheses or a minus sign to indicate a negative contribution margin and/or a decrease in operating income from the special order.) Total Order Incremental Analysis of Special Sales Order Decision Per Unit (5,200 units) Revenue from special order Less variable expense associated with the order: Variable manufacturing costs Contribution margin Less: Additional fixed expenses associated with the order Increase (decrease) in operating income from the special order Decision: Requirement 2. Identify long-term factors Buoy should consider in deciding whether to accept the special sales order. In addition to determining the special order's effect on operating profits, Buoy's managers also should consider the following: A. How will Buoy's competitors react? Will they retaliate by cutting their prices and starting a price war? B. Will Buoy's other customers find out about the lower sale price Buoy accepted from Overton? If so, will these other customers demand lower sale prices? OC. Will lowering the sale price tarnish Buoy's image as a quality brand? D. All of the above. E. None of the above. Data table Buoy Contribution Margin Income Statement (Variable Costing) For Sales Volume of 32,000 Units Sales revenue Total S 480,000 Less variable expenses: Variable manufacturing costs (DM, DL, Variable MOH) 160,000 112,000 Variable operating expenses (selling and administrative) Contribution margin S 208,000 Less fixed expenses: Fixed manufacturing overhead S 122,000 93,000 Fixed operating expenses (selling and administrative) Operating income (loss) $ (7,000) Print Done