- (TCO 5) The following information relates to a product produced by Bayfield Company:
Fixed selling costs are $1,000,000 per year. Although production capacity is 900,000 units per year, Bayfield expects to produce only 800,000 units next year. The product normally sells for $170 each. A customer has offered to buy 60,000 units for $160 each. Compute the effect on the net income if Bayfield accepts the special order.