Questions 4 and 5 refer to the following problem:

At the end of the year, a company offered to buy 4,610 units of a product from X Company for $11.00 each instead of the company's regular price of $19.00 each. The following income statement is for the 67,200 units of the product that X Company has already made and sold to its regular customers:

Sales		$1,276,800
Cost of goods sold		588,000
Gross margin		$688,800
Selling and administrative costs		157,248
Profit		$531,552

For the year, fixed cost of goods sold were $124,992, and fixed selling and administrative costs were $88,032. The special order product has some unique features that will require additional material costs of $0.81 per unit and the rental of special equipment for $5,000. 4. Profit on the special order would be

A. $3992 B.$4671 C.$5465 D.$6394 E$7481 F.$8752

5. The marketing manager thinks that if X Company accepts the special order, regular customers will be lost unless the selling price for them is reduced by $0.18. The effect of reducing the selling price will be to decrease firm profits by

A: $2,736

B: $3,968

C: $5,753

D: $8,342

E: $12,096

F: $17,539