Beachwood Classics makes children's furniture and has received a special order for 1,500 sets for $35 per set. Each set consists of a table and two chairs. The regular average selling price is $40 per set. The unit product cost per set is: direct labour, $5.50; direct materials, $8.75; variable overhead, $1.75; and fixed overhead, $3.25. Beachwood will save $2.00 per unit in sales commission on this special order, however it will incur $1,500 in additional shipping costs for the special-order. No other fixed costs will be impacted. The company had already budgeted its production at 6,500 units. If the company is already operating at full capacity and the offer is accepted, what will the incremental operating income?

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