Exercise $4-27($Algo$)$ Special Orders $($LO $4-1,2)$

Nardin Outfitters has a capacity to produce $16,500$ of their special arctic tents per year. The company is currently producing and seling

$5,000$ tents per year at a selling price of $$1,350$ per tent. The cost of producing and selling one tent follows.

The company has received a special order for $1,400$ tents at a price of $$690$ per tent from Chipman Outdoor Center. It will not have to

pay any sales commission on the special order, so the variable selling and administrative costs would be only $$54$ per tent. The special

order would have no effect on total fixed costs. The company has rejected the offer based on the following computations:

Required:

Q$.$ What is the impact on profit for the year if Nardin Outfitters accepts the special order?

b$.$ Do you agree with the decision to reject the special order?

Required A

What is the impact on profit for the year if Nardin Outfitters accepts the special order? $($Enter your answers in thousands

rounded to $1$ decimal place. $($i$.$e$.,5,400,400$ should be entered as $5,400\mathrm{.}4).$ Select option "higher" or "lower", keeping Status

Quo as the base. Select "none" if there is no effect.$)$