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What effect will acceptance of the offer have on net income

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Question - It costs Lannon Fields $25 of variable costs and $12 of allocated fixed costs to produce an industrial trash can that sells for $60. A buyer in Mexico offers to purchase 3,000 units at $35 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 $12,000

b. Increase $12,000

c. Increase $108,000

d. Increase $10,000

Reference no: EM133151598

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