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Samson Incorporated provided the following information regarding its only product: Sale...

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Accounting

Samson Incorporated provided the following information regarding its only product:

Sale price per unit

$50.00

Direct materials used

$160,000

Direct labor incurred

$185,000

Variable manufacturing overhead

$120,000

Variable selling and administrative expenses

$70,000

Fixed manufacturing overhead

$65,000

Fixed selling and administrative expenses

$12,000

Units produced and sold

20,000

Assume no beginning inventory

Assuming there is excess capacity, what would be the effect on operating income of accepting a special order for 3,000 units at a sale price of $45 per product?

a. increase by $43,000

b. increase by $135,000

c. increase by $54,750

d. increase by $150,000

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