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Markson Company had the following results of operations for the past year: Sales (8,000 units at $20.90) $ 167,200 Variable manufacturing costs $ 89,600 Fixed

Markson Company had the following results of operations for the past year:

Sales (8,000 units at $20.90) $ 167,200
Variable manufacturing costs $ 89,600
Fixed manufacturing costs 15,900
Variable selling and administrative expenses 15,600
Fixed selling and administrative expenses 20,900 (142,000 )
Operating income $ 25,200

A foreign company whose sales will not affect Markson's market offers to buy 2,000 units at $15.35 per unit. In addition to variable manufacturing costs, selling these units would increase fixed overhead by $1,690 for the purchase of special tools. Marksons annual productive capacity is 12,000 units. If Markson accepts this additional business, its profits will:

  • Increase by $4,400.

  • Decrease by $4,800.

  • Decrease by $6,090.

  • Increase by $2,710.

  • Decrease by $1,690.

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