with floor mattresses to use in physical education classes. Gregg has received a special order from a large school district to buy 12,200 mats at $48 each. Acceptance of the special order will not affect fixed costs but will result in $3,200 of shipping costs.

For the first 6 months of 2020, the company reported the following operating results while operating at 80% capacity:

Sales (100,000 units) $7,000,000

Cost of goods sold 4,000,000

Operating expenses 2,000,000

Net income $ 1,000,000

Cost of goods sold was 60% variable and 40% fixed; operating expenses were 70% variable and 30% fixed. If the special order is accepted, what will be the effect on net income?

with floor mattresses to use in physical education classes. Gregg has received a special order from a large school district to buy 12,200 mats at $48 each. Acceptance of the special order will not affect fixed costs but will result in $3,200 of shipping costs.

For the first 6 months of 2020, the company reported the following operating results while operating at 80% capacity:

Sales (100,000 units) $7,000,000

Cost of goods sold 4,000,000

Operating expenses 2,000,000

Net income $ 1,000,000

Cost of goods sold was 60% variable and 40% fixed; operating expenses were 70% variable and 30% fixed. If the special order is accepted, what will be the effect on net income?