PressPress

Products manufactures t-shirts. It has the following costs when its production level is

85 comma 00085,000

units (t-shirts):

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(Click the icon to view additional information.)What will happen to

PressPress's

operating income if it accepts this special order?Complete the following incremental analysis to determine the impact on

PressPress's

operating income if it accepts this special order. (Round all per unit amounts to the nearest cent, $X.XX, and all other amounts to the nearest whole dollar. Enter a "0" for any zero balances. Use parentheses or a minus sign to indicate a decrease in contribution margin and/or operating income from the special order.)

		Total Order
Incremental Analysis of Special Sales Order Decision	Per Unit	(8,500 units)
Revenue from special order
Less variable expense associated with the order:
Direct materials
Direct labor
Variable manufacturing overhead
Contribution margin
Less: Additional fixed expenses associated with the order
Increase (decrease) in operating income from the special order

COSTS:

	Total costs for
	85,000 units
Direct materials	$289,000
Direct labor	46,750
Variable manufacturing overhead	68,000
Fixed manufacturing overhead	160,000
Total manufacturing costs	$563,750

ADDITIONAL INFO:

The company's relevant range extends to

98 comma 50098,500

units.

PressPress

has received a special order for

8 comma 5008,500

t-shirts at a special price of

$ 59 comma 500$59,500

for the entire order. The special order t-shirt would use a fabric that is less expensive than the standard fabric used by

PressPress,

which would allow

PressPress

to save

$ 0.30$0.30

per t-shirt in direct materials when manufacturing this special order.

PressPress

has the excess capacity to manufacture this special order. Its total fixed costs will not be impacted by the special order.