Pam and Lenny’s ice cream shop charges $1.65 for a cone. Variable expenses are $0.28 per cone, and fixed costs total $2,500 per month. A “sweetheart” promotion is being planned for the second week of February. During this week, a person buying a cone at the regular price would receive a free cone for a friend. It is estimated that 700 additional cones would be sold and that 900 cones would be given away. Advertising costs for the promotion would be $140.

Required:

a. Calculate the effect of the promotion on operating income for the second week of February.