> Data table efe ed th Bol afd nus le Coastal Safety Contribution Margin Income Statement (Variable Costing) For Sales Volume of 30,000 Units Total red $ 450,000 90,000 110,000 mer Sales revenue Less variable expenses: Variable manufacturing costs (DM, DL, Variable MOH) Variable operating expenses (selling and administrative) Contribution margin Less fixed expenses: Fixed manufacturing overhead Fixed operating expenses (selling and administrative) Operating income (loss) $ 250,000 TO" ng $ 121,000 87,000 ncr $ 42,000 fra riabil Coastal Safety manufactures flotation vests in San Diego, California, Coastal Safety's contribution margin income statement for the most recent month contains the following data: Click the icon to view the cost information.) Suppose Boat Safety Cruiselines wants to buy 5,800 vests from Coastal Safety. Acceptance of the order will not increase Coastal Safety's variable marketing and administrative expenses or any of its fixed expenses. The Coastal Safety plant has enough unused capacity to manufacture the additional vests. Boat Safety Cruiselines has offered $7 per vest, which is below the normal sale price of $15. Requirement 1. Prepare an incremental analysis to determine whether Coastal Safety should accept this special sales order. (Enter a "O" 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 (5,800 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 0 Decision: Requirement 2. Identify long-term factors Coastal Safety should consider in deciding whether to accept the special sales order, In addition to determining the special order's effect on operating profits, Coastal Safety's managers also should consider the following O A. How will Coastal Safety's competitors react? Will they retaliate by cutting their prices and starting a price war? OB. Will lowering the sale price tarnish Coastal Safety's image as a quality brand? OC. Will Coastal Safety's other customers find out about the lower sale price Coastal Safety accepted from Boat Saty? If so, will these other customers demand lower sale prices? D. All of the above O E None of the above