Nardin Outfitters has a capacity to produce 19,500 of their special arctic tents per year. The company is currently producing and selling 5,000 tents per year at a selling price of $1,650 per tent. The cost of producing and selling one tent follows:

Variable manufacturing costs	$ 590
Fixed manufacturing costs	165
Variable selling and administrative costs	155
Fixed selling and administrative costs	125
Total costs	$ 1,035

The company has received a special order for 2,000 tents at a price of $750 per tent from Chipman Outdoor Center. It will not have to pay any sales commission on the special order, so the variable selling and administrative costs would be only $60 per tent. The special order would have no effect on total fixed costs. The company has rejected the offer based on the following computations:

Selling price per case	$ 750
Variable manufacturing costs	590
Fixed manufacturing costs	165
Variable selling and administrative costs	60
Fixed selling and administrative costs	125
Net profit (loss) per case	$ (190)

Required:

a.What is the impact on profit for the year if Nardin Outfitters accepts the special order?

b.Do you agree with the decision to reject the special order?

Nardin Outfitters has a capacity to produce 19,500 of their special arctic tents per year. The company is currently producing and selling 5,000 tents per year at a selling price or $1,650 per tent. The cost of producing and selling one tent follows: The company has received a spectal order for 2,000 tents at a price of $750 per tent from Chipman Outdoor Center. It will not have to pay any sales commission on the special order, so the variable selling and administrative costs would be only $60 per tent. The special order would have no effect on total fixed costs. The company has rejected the offer based on the following computations: Required: a. What is the impact on profit for the year if Nardin Outfitters occepts the special order? b. Do you agree with the decision to reject the special order? What is the impact on profit for the year if Nardin Outfitters accepts the special order? (Enter your answers in thousands rounded to 1 decimal place. (1.e., 5,400,400 should be entered as 5,400.4). Select option "higher" or "lower", keeping Status Quo as the base. Select "none" if there is no effect.)