Jax Inc. reports the following data for its only product. The company had no beginning finished goods inventory and it uses absorption costing.

1. Compute gross profit assuming 

(a) 60,000 units are produced and 60,000 units are sold 

(b) 80,000 units are produced and 60,000 units are sold.
2. By how much would the company's gross profit increase or decrease from producing 20,000 more units than it sells?

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Sales price Direct materials $56.00 per unit $9.00 per unit Direct labor... Variable overhead Fixed overhead.. $6.50 per unit $11.00 per unit $720,000 per year