Per Undergarment Total Direct materials $2.08 $2,275,520 Direct labor 0.44 481,360 Variable manufacturing overhead 0.99 1,083,060 Fixed manufacturing overhead 1.44 1,575,360 Variable selling expenses 0.39 426,660 Totals $5.34 $5,841,960 The U.S. Army has approached Klean Fiber and expressed an interest in purchasing 250,800 Y-Go undergarments for soldiers in extremely warm climates. The Army would pay the unit cost for direct materials, direct labor, and variable manufacturing overhead costs. In addition, the Army has agreed to pay an additional $0.95 per undergarment to cover all other costs and provide a proft. Presently, Klean Fiber is operating at 70% capacity and does not have any other potential buyers for Y-Go. If Klean Fiber accepts the Army's offer, it will not incur any variable selling expenses related to this order. Prepare an incremental analysis for the Klean Fiber. (Enter negative amounts using either a negative sign preceding the number eg.-45 or parentheses eg. (45)) Revenues Variable costs: Direct materials Direct labor 5 Reject Order S Accept Order 1134365 Net Income Increase (Decrease) 113465 508515 508915 120240 -120240 Variable overhead 280300 230300 Tocal variable costs 879255 +379255