Give correct answer with correct approach.

Taylor Manufacturing had the following results of operations for the past year: Sales (18,000 units at $12) $216,000 Direct materials and direct labor $108,000 Overhead (25% variable) $20,000 Selling and administrative expenses (all fixed) $35,000 Operating income ($19,000) A foreign company (whose sales will not affect Taylor's market) offers to buy 5,000 units at $8.50 per unit. In addition to variable manufacturing costs, selling these units would increase fixed overhead by $800 and selling and administrative costs by $400. If Taylor accepts the offer, its profits will: A. Increase by $37,500. B. Increase by $9,900. C. Decrease by $7,000. D. Increase by $6,250. E. Increase by $5,800.Taylor Manufacturing had the following results of operations for the past year: Sales (18,000 units at $12) $216,000 Direct materials and direct labor $108,000 Overhead (25% variable) $20,000 Selling and administrative expenses (all fixed) $35,000 Operating income ($19,000) A foreign company (whose sales will not affect Taylor's market) offers to buy 5,000 units at $8.50 per unit. In addition to variable manufacturing costs, selling these units would increase fixed overhead by $800 and selling and administrative costs by $400. If Taylor accepts the offer, its profits will: A. Increase by $37,500. B. Increase by $9,900. C. Decrease by $7,000. D. Increase by $6,250. E. Increase by $5,800