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Voyage Sail Makers manufactures sails for sailboats. The company has the capacity to produce 37,000 sails per year and is currently producing and selling
Voyage Sail Makers manufactures sails for sailboats. The company has the capacity to produce 37,000 sails per year and is currently producing and selling 30,000 sails per year. The following information relates to current production Sales price per unit Variable costs per un Manufacturing Selling and administrative Total foxed costs Manufacturing Seling and administrative $185 $50 $20 $700,000 $300,000 If a special pricing order is accepted for 5,000 sais at a sales price of $170 per unit, and foxed costs remain unchanged, what is the change in operating income? (Assume the special pricing order will require vanable manufacturing costs and variable selling and administrative costs) OA Operating income increases by $952,000 OB Operating income decreases by $952,000 OC. Operating income increases by $500,000 OD Operating income decreases by $500,000
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