Last year, X Company sold 60,500 units of its only product for $19.00 each. Total costs were as follows:

Cost of goods sold
Variable	$384,175
Fixed	125,840
Selling and administrative
Variable	$73,810
Fixed	69,575

At the end of the year, a company offered to buy 4,430 units of the product for $11.00 each instead of $19.00. X Company's production manager thought that the special order units would probably require additional variable costs per unit of $1.15 and the rental of special equipment for $2,000. X Company had the capacity to produce the additional units, and there would have been no selling and administrative costs for the special order. But X Company still rejected the order. 5. If X Company had accepted the special order, firm profits would have increased by

A: $4,316

B: $5,740

C: $7,635

D: $10,154

E: $13,505

F: $17,962

Tries 0/99

6. There was concern that regular customers would have found out about the special order, and X Company's regular sales this year would have fallen by 500 units. The result of these lost sales would have been to reduce X Company's profits this year by

A: $1,293

B: $1,875

C: $2,718

D: $3,941

E: $5,715

F: $8,287