Exercise $10-13($Algo$)$ Special offer pricing LO P$7$

Farrow Company reports the following annual results.

The company receives a special offer for $20,000$ units at $$12$ per unit. The additional sales would not affect its normal sales. Variable

costs per unit would be the same for the special offer as they are for the normal units. The special offer would require incremental

fixed overhead of $$80,000$ and incremental fixed general and administrative costs of $$86,000.$

$($a$)$ Compute the income or loss for the special offer.

$($b$)$ Should the company accept or reject the special offer?

Complete this question by entering your answers in the tabs below.

Required $A$

Compute the income or loss for the special offer.

Note: Round your "Per Unit" answers to $2$ decimal places.