Requirement 1. How would accepting the order affect Ashford's operating income? In addition to the special onder's effect on profits, what other (longer-term qualitative) factors should Ashford'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 25,000 sun, ses $ 85 $2,125,000 Expected increase in expenses 25,000 sunglassesx $ 61 (1.525,000) $600,000 Expected increase in operating income In addition to the special order's effect on profits, what other (longer-term qualitative) factors should Ashford's managers consider in deciding whether to accept the order? A Will Ashford's other customers find out about the lower sale price Ashford offered to Montana Shades? If so, will these other customers demand lower sale prices? OB. Will lowering the sale price tamish Ash's image as a high-quality brand? OC. How will Ashford's competitors react? Will they retaliate by cutting their prices and starting a price war? D. All of the above E. None of the above Requirement 2. Ashford's marketing manager, Peter Kyler, argues against accepting the special order because the offer price of $85 is less than Ashford's $80 cost to make the sunglasses Kyler asks you, as one of Ashford's staff accountants, to explain whether his analysis is correct. What would you say? Costs that we will incur whether or When deciding whether to accept a special order, we should compare the revenues we will receive against the differential costs we will incur to the order not we fill the order are irrelevant to our decision. This is why comparing the $85 price Montana Shades offered us with our 500 total cost of making the sunglasses is incorrect The additional revenues and the additional costs that we will incur to fill the special order are If we accept the Montana Shades special order, we will incur only of additional cost per pair, which is per pair that Montana Shades offered. Therefore, we should the special order to than the $85 the company's Clear all Check answer