Newtown Sunglasses sell for about $152 per pair. Suppose that the company incurs the following average costs per pair: (Click the icon to view the cost information.) Newtown has enough idle capacity to accept a one-time-only special order from Water Shades for 28,000 pairs of sunglasses at $71 per pair. Newtown will not incur any variable selling expenses for the order Read the reguirements Requirement 1. How would accepting the order affect Newtown's operating income? In addition to the special order's effect on profits, what other (longer-term qualitative) factors should Newtown's managers consider in deciding whether to accept the order? Prepare the analysis to determine the effect on operating income. (Enter decreases to profits with a parentheses or minus sign.) Expected increase in revenues Expected increase in expenses Expected in operating income Data Table Requirements Direct materials Direct labor Variable manufacturing overhead Variable selling expenses Fixed manufacturing overhead Total cost $1,950,000 Total fixxed manufacturing overhead /97,500 Pairs of sunglasses 39 1. How would accepting the order affect Parkland's operating income? In addition to the special order's effect on profits, what other longer-term qualitative) factors should Parkland's managers consider in deciding whether to accept the order? 2. Parkland's marketing manager, Peter Root, argues against accepting the special order because the offer price of $71 is less than Parkland's $79 cost to make the sunglasses. Root asks you, as one of Parkland's staff accountants, to explain whether his analysis is correct. What would you say? 79 Print Done Print Done