The following information relates to current production of outdoor chaise lounges at

Backyard Posh:

Variable manufacturing costs per unit

Total fixed manufacturing costs

Variable marketing and administrative costs per unit

Total fixed marketing and administrative costs

$$104$

$$525,000$

$$34$

$$250,000$

The regular selling price per chaise lounge is $$330.$ The company is analyzing the opportunity

to accept a special sales order for $1,500$ chaise lounges at a price of $$225$ per unit. Fixed

costs would remain unchanged. The company has the capacity to produce $15,000$ chaise

lounges per year, but is currently producing and selling $9,000$ chaise lounges per year.

Regular sales will not be affected by the special order. What is the impact on operating

income if the company accepts the special order?

A$.$ Decrease by $$337,500$

B$.$ Decrease by $$130,500$

C$.$ Increase by $$337,500$

D$.$ Increase by $$130,500$