Increase by $40,000

Decrease by $28,750

Decrease by $10,000

Increase by $11,250

Arkansas Company has no beginning and ending inventories, and has obtained the following data for its only product: Selling price per unit $65 Direct materials used $150,000 Direct labor $225,000 Variable factory overhead $140.000 Variable selling and administrative expenses $60,000 Fixed factory overhead $370,000 Fixed selling and administrative expenses $30.000 Units produced and sold 20,000 Assume there is excess capacity. There is a special order outstanding for 1,000 units at $40.00 per unit. If Arkansas Company accepts the special order, net income would