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Clear Sky Sailmakers manufactures sails for sailboats. The company has the capacity to produce15,000 sails peryear, but is currently producing and selling10,000 sails per year.

Clear Sky Sailmakers manufactures sails for sailboats. The company has the capacity to produce15,000 sails peryear, but is currently producing and selling10,000 sails per year. The following information relates to currentproduction:

Sale price per unit $250
Variable costs perunit:
Manufacturing $165
Marketing and administrative $50
Total fixedcosts:
Manufacturing $750,000
Marketing and administrative $200,000

If Clear Sky Sailmakers accepts a special order for5,000 sails at a price of$225 perunit, and fixed costs remainunchanged, how would operating income beaffected? (NOTE: Assume regular sales are not affected by the specialorder.)

A. Increase by$150,000B. Increase by$50,000C. Decrease by$50,000D. Increase by$1,125,000

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