5. Snyder, Inc., which has excess capacity, received a special order for 4,200 units at a price of $17 per unit. Currently, production and sales are anticipated to be 12,000 units without considering the special order. Budget information for the current year follows. Sales $ 240,000 Less: Cost of goods sold 186,000 Gross margin $ 54,000 Cost of goods sold includes $30,000 of fixed manufacturing cost. If the special order is accepted, the company's income will:

increase by $6,300.

decrease by $6,300.

increase by $16,800.

decrease by $16,800.

None of these.

7.Song, a division of Carolina Enterprises, currently makes 160,000 units of a product that has created a number of manufacturing problems. Song's costs follow.

Manufacturing costs:
Variable	$ 630,000
Fixed	183,000
Allocated corporate administrative cost	64,000

If Song were to discontinue production, fixed manufacturing costs would be reduced by 70%. The relevant cost of deciding whether the division should purchase the product from an outside supplier is:

$813,000.

$822,100.

$630,000.

$758,100.

$684,900.