Colby Company manufactures and sells a single product called the par. Operating at capacity, the company can produce 30,000 pars per year. Costs associated with this level of production and sales are given below: Units Total Direct material Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expense Fixed Total PhP15PhP450,000 240,000 90,000 270,000 120,000 180,000 PhP45 PhP1,350,000 4 The Pars normally sell for P50 each. Fixed manufacturing overhead is constant at P270,000 per year. Due to a recession, Colby Company expects to sell 25,000 Pars through regular channels next year. A large retail chain has offered to purchase 5,000 Pars if Colby is willing to accept a 16%discount off the regular price. There will be no sales commissions on this order thus variable selling expenses would be slashed by 75%. However, Colby will have to purchase a special machine for Colby to engrave the chain's name on the 5,000 units. The machine would cost P10,000. Colby has no assurance that the chain will purchase additional units in the future. What is the impact of the special order on next year's profit? A) Decrease of P100,000 in the net operating income B) Decrease of P35,000 in the net operating income C) The special order narrowed down the decrease in the net operating income by P65,000 D) The special order narrowed down the decrease in net operating income by P35,000