Midwest Company manufactures lamps. Shop Smart, a large retail merchandiser, wants to buy $240,000$ lamps from Midwest Company for $$10$ each. The lamp would carry Shop Smart$$s name and would be sold in its stores. Midwest Company normally sells $420,000$ lamps a year at $$14$ each; its production capacity is a total of $500,000$ units a year. Cost information for the lamps is as follows: Production costs: Variable production costs $$7$ per unit Fixed manufacturing overhead $($$$2,100,000/420,000$ units$)$ $$5$ per unit Selling and administrative expenses: Fixed $($$$840,000/420,000$ units$)$ $$2$ per unit Shop Smart has indicated that the company is not interested in signing a contract for less than $240,000$ lamps. Total fixed costs will not change regardless of whether the Shop Smart order is accepted. By how much will overall Midwest Company$$s net income change if the Shop Smart order is accepted?

Midwest Company net income will INCREASE by $$720,000$ if the order is accepted.

Midwest Company net income will INCREASE by $$400,000$ if the order is accepted.

Midwest Company net income will DECREASE by $$720,000$ if the order is accepted.

Midwest Company net income will DECREASE by $$400,000$ if the order is accepted.