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Seville Company manufactures a product with a unit variable cost of $42 and a unit sales price of $75. Fixed costs were $80,000 when 10,000 units were produced and sold. The company has a one-time opportuity to sell an additional 2,000 units at $55 each in an international market which would not affect its present sales. The company has sufficient capacity to produce the additional units. How much is the relevant income effect of accepting the special order?

A) $84,000

B) $40,000

C) $26,000

D) $10,000

Accounting Basics, Accounting

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