Acceptance Of The Offer Have On Net Income 547965

It costs Lannon Fields $14 of variable costs and $6 of allocated fixed costs to produce an industrial trash can that sells for $30. A buyer in Mexico offers to purchase 3,000 units at $18 each. Lannon Fields has excess capacity and can handle the additional production. What effect will acceptance of the offer have on net income?

a.Decrease $6,000

b.Increase $6,000

c.Increase $54,000

d.Increase $12,000