PRO Shops Has a Capacity of 45,000 Units and Is

Multiple Choice

PRO Shops has a capacity of 45,000 units and is currently producing and selling 40,000 at $25 a unit. The present cost structure, on a per unit basis, is: $$\begin{array} { l r } \text { Direct material } & \$ 10 \\\text { Direct labour } & 5 \\\text { Variable overhead } & 3 \\\text { Fixed overhead } & 4\end{array}$$ An order for 7,000 units has been received from a Japanese company at a price of $20 per unit. If the order is accepted, profit will:

A) Decrease by $2,000
B) Increase by $14,000
C) Increase by $7,000
D) Not change