The Melrose Corporation produces a single product, Product C. Melrose has the capacity to produce 72,000 units of Product C each year. If Melrose produces at capacity, the per unit costs to produce and sell one unit of Product C are as follows:

The Melrose Corporation produces a single product, Product C. Melrose has the capacity to produce 72,000 units of Product C each year. If Melrose produces at capacity, the per unit costs to produce and sell one unit of Product C are as follows: $ 20.7 $ 17.4 $ 13.3 $ 14.5 $ 12.2 $ 8.1 Direct materials Direct labor Fixed manufacturing overhead Variable selling expense Fixed selling expense The regular selling price of one unit of Product C is $91.2. A special order has been received by Melrose from Moore Corporation to purchase 3,000 units of Product C during the upcoming year. If this special order is accepted, the variable selling expense will be reduced by 75%. Total fixed manufacturing overhead and fixed selling expenses would be unaffected except that Melrose will need to purchase a specialized machine to engrave the Moore name on each unit of product C in the special order. The machine will cost $5,400 and will have no use after the special order is filled. Assume that direct labor is a variable cost. Suppose Melrose can sell 70,000 units of Product C to regular customers next year. If Moore Corporation offers to buy the special order units at $81.2 per unit, the effect of accepting the special order for 3,000 units on Melrose's net operating income for next year will be a $92,750 increase $47,250 increase $103.250 increase $282750 increase