$1$ Problem $7-14($Static$)$

AudioCables, Incorporated, is currently manufacturing an adapter that has a varlable cost of $$\mathrm{.}50$ per unit and a selling price of $$1\mathrm{.}00$ per unit. Fixed costs are $$14,000.$ Current sales volume is $30,000$ units. The firm can substantially improve the product quality by adding a new plece of equipment at an additional fixed cost of $$6,000.$ Varlable costs would increase to $$\mathrm{.}60,$ but sales volume should jump to $50,000$ units due to a higher$-$quality product.

a$.$ What is the current profit and proposed profit from the sales of AudioCables?

Note: Leave no cells blank $-$ be certaln to enter $"0"$ wherever required.

$\backslash$table$[[$Current profit$],[$Proposed profit$]]$

b$.$ Should AudioCables buy the new equipment? Yes

No

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