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It costs Carla Vista Company $ 7 of variable costs and $ 3 of fixed costs to produce its product at full capacity. However, the

It costs Carla Vista Company $7 of variable costs and $3 of fixed costs to produce its product at full capacity. However, the company currently has unused capacity. The product sells for $15. Sandhill Company offers to purchase 3540 units at $9 each. Carla Vista will incur special shipping costs of $2.50 per unit. If the special offer is accepted and produced with unused capacity, net income will
increase $7080.
increase $1770.
decrease $7080.
decrease $1770.
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