Philly Pretzels Produces Specialty Pretzels Which It Normally Sells as a Box

Essay

Philly Pretzels produces specialty pretzels which it normally sells as a box of a dozen pretzels. The cost per box of 12 pretzels is normally $6, of which $4.50 is variable and $1.50 is fixed. A local charity has requested to purchase 500 boxes at $4 per box. Philly Pretzels has sufficient unused capacity to produce the 500 special-order units. If the special order is accepted, what will the effect be on the income of Philly Pretzels?