Farrow Company reports the following annual results.

Contribution Margin Income StatementPer UnitAnnual TotalSales (380,000 units)$ 15.00$ 5,700,000Variable costs Direct materials2.00760,000Direct labor4.001,520,000Overhead2.50950,000Contribution margin6.502,470,000Fixed costs Fixed overhead2.00760,000Fixed general and administrative1.50570,000Income$ 3.00$ 1,140,000

The company receives a special offer for 38,000 units at $13 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 $152,000 and incremental fixed general and administrative costs of $163,000. (a) Compute the income or loss for the special offer. (b) Should the company accept or reject the special offer?