Morrison Company has a request for a special order of 20 Christmas Wreaths from a local vendor. The normal selling price is $300 and its unit product cost is $174, as show below: Most of the manufacturing overhead is fixed and unaffected by variations in how many Christmas Wreaths are produced in a given period. However, $9 of the overhead is variable, depending on the number of wreaths made. The customer would like a special bow tied to the wreath requiring additional materials costing \$7 per wreath and would also require a special tool costing $205 that would have no other use once the special order was completed. This order would have no effect on the company's regular sales, and the order could be filled using the company's existing capacity without affecting any other order. Required: What effect would accepting this order have on the company's operating income if a special price of $250 is offered per wreath for this order? Should the special order be accepted at this price
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