Lane Company manufactures a single product. In 2014, the company incurred the following costs (all costs are expressed on an annual basis):
Sales Revenue
Total
Units produced and sold
8,000
Selling price
$20
Sales revenue
$160,000
Manufacturing Costs
Direct material
$36,000
Direct labor
$12,800
Overhead (a)
$70,000
Total manufacturing cost
$118,800
Fixed selling and administrative expenses
$ 25,000
Total expenses
$143,800
Profit before tax
$16,200
(a) Manufacturing overhead:
Fixed manufacturing overhead
$6,000
Variable manufacturing overhead
$64,000
Total manufacturing overhead
$70,000
Requirement 6: How much profit would the company earn if the selling price per unit decreased by $1.50 and the sales volume increased by 25%? You do not need to add a dollar sign to your answer; only input the numerical value.
Lane Company manufactures a single product. In 2014, the company incurred the following costs (all costs are expressed on an annual basis):
Sales Revenue
Total
Units produced and sold
8,000
Selling price
$20
Sales revenue
$160,000
Manufacturing Costs
Direct material
$36,000
Direct labor
$12,800
Overhead (a)
$70,000
Total manufacturing cost
$118,800
Fixed selling and administrative expenses
$ 25,000
Total expenses
$143,800
Profit before tax
$16,200
(a) Manufacturing overhead:
Fixed manufacturing overhead
$6,000
Variable manufacturing overhead
$64,000
Total manufacturing overhead
$70,000
Requirement 6: How much profit would the company earn if the selling price per unit decreased by $1.50 and the sales volume increased by 25%? You do not need to add a dollar sign to your answer; only input the numerical value.