Sensuous Company makes and sells 12,000 necklaces each year. The cost of making one necklace follows:

Direct material		$ 11
Variable manufacturing overhead		5
Direct labor		2
Fixed manufacturing overhead		7

The fixed overhead costs are unavoidable. Sensuous allocates fixed overhead costs based on its annual manufacturing capacity of 15,000 necklaces. An overseas company recently offered to buy 4,000 necklaces at $21 each. Regular customers buy necklaces from Sensuous at $30 each. How much is the net benefit (loss) of accepting the special order?

($16,000)

$12,000

($48,000)

$36,000