Harry Ltd is manufacturing 1,000 units of a product. The present costs and sales data are as follows:

Selling price per unit$10

Variable costs per unit$5

Fixed costs$4,000

The management is considering the following option:

To reduce the production from the current 1,000 units to 800 units and to buy 200 units from the market at $7.50 per unit. Under this option fixed costs would decline by $600.

What is the incremental impact on profit/loss of the company if the above option is taken? Please show all calculations.