E17.13 Prepare a CVP statement of profit or loss before and after changes in business environment. LO6 Chalet Ltd had sales in 2019 of $1 500 000 on 60 000 units. Variable costs totalled $720 000, and fixed costs totalled $500 000.

A new raw material is available that will decrease the variable costs per unit by 20% (or

$2.40). However, to process the new raw material, fixed operating costs will increase by $50 000.

Management feels that one-half of the decline in the variable costs per unit should be passed on to customers in the form of a sales price reduction. The marketing department expects that this sales price reduction will result in a 5% increase in the number of units sold.

Required Prepare a CVP statement of profit or loss for 2019, assuming the changes are made as described.