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Lakeside Inc. produces a product that currently sells for $76.00 per unit. Current production costs per unit include direct materials, $29; direct labor, $31; variable

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Lakeside Inc. produces a product that currently sells for $76.00 per unit. Current production costs per unit include direct materials, $29; direct labor, $31; variable overhead, $14.50; and fixed overhead, $14.50. Product engineering has determined that certain production changes could refine the product quality and functionality. These new production changes would increase material and labor costs by 20% per unit. Lakeside has received an offer from a nonprofit organization to buy 9,900 units at $75.10 per unit. Lakeside currently has unused production capacity. Required: a. Calculate the effect on Lakeside's operating income of accepting the order from the nonprofit organization. Increase in operating income b. Should Lakeside accept this special sales order? O Yes O NO

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