Hampshire Sunglasses sell for about $153 per pair. Suppose that the company incurs the following average costs per pair: E (Click the icon to view the cost information.) Hampshire has enough idle capacity to accept a one-time-only special order from Alaska Shades for 20,000 pairs of sunglasses at $85 per pair. Hampshire will not incur any variable selling expenses for the order. Read the requirements. Requirement 1. How would accepting the order affect Hampshire's operating income? In addition to the special order's effect on profits, what other (longer-term qualitative) factors should Hampshire's managers consider in deciding whether to accept the order? i Data Table Prepare the analysis to determine the effect on operating income. (Enter decreases to profits with a parentheses or minus sign.) Expected increase in revenues sunglasses x Expected increase in expenses sunglasses x D Expected in operating income Requirements - X 1. How would accepting the order affect Hampshire's operating income? In addition to the special order's effect on profits, what other (longer-term qualitative) factors should Hampshire's managers consider in deciding whether to accept the order? 2. Hampshire's marketing manager, Peter Preston, arques against accepting the special order because the offer price of $85 is less than Hampshire's $90 cost to make the sunglasses. Preston asks you, as one of Hampshire's staff accountants, to explain whether his analysis is correct. What would you say? Direct materials Direct labor Variable manufacturing overhead Variable selling expenses Fixed manufacturing overhead Total cost * $2,000,000 Total fixed manufacturing overhead / 80,000 Pairs of sunglasses 90