Biology Forums - Study Force

Tiger Pride produces two product lines: T-shirts and Sweatshirts. Product profitability is analyzed as follows:

T-SHIRTSSWEATSHIRTS
Production and sales volume60,000 units35,000 units
Selling price$16.00$29.00
Direct material$ 2.00$ 5.00
Direct labor$ 4.50$ 7.20
Manufacturing overhead$ 2.00$ 3.00
Gross profit$ 7.50$13.80
Selling and administrative$ 4.00$ 7.00
Operating profit$ 3.50$ 6.80

What is the projected decline in operating income if the direct materials costs of T-Shirts increase to $3.50 per unit and direct labor costs of Sweatshirts increase to $13.00 per unit?
A) $293,000
B) $90,000
C) $203,000
D) $473,000

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good answer

Thank you

thanks