C & C Sports Continuing Problem 7-30 Chad Davis, C&C Sports' vice president for operations, recently received a sales brochure for a new electric cutting tool. Based on the tool's specifications, Chad believes that C&C Sports could increase the batch size on jersey production to 50 jerseys, up from the current 35 jerseys. While the cutting tool would be used on pants and award jackets as well, other production factors prevent increasing the batch sizes for these products. The new tool would increase annual operating costs by $14,082. Before deciding whether to purchase the cutting tool, Chad wants to know how the new tool will affect the cost of producing the company's three products Budgeted Units per Cut per production Batch Pants erseys ackets Batch 50 35 4 183,500 66,500 18,000 Chenille Machine Costs Product Warehousing/ raceable to Jackets Design Packaging Cutting Sewing ng Sewing General Total_ Indirect labor $ 2,514 4,092 125,994 $40,000 40,000 7,396 110,869 $7,500 $ 15,000 $105,986 $ 211,000 46,184 511,300 110,000 58,330 55,000 41,436 $147,108 $206,820 $292,271 $1,033,250 34,696 135,861 101,064 Indirect materials Rent Utilities Insurance Other 37,512 110,000 41,330 17,000 55,000 4,285 6,377 $83,889 12,297 $170,562 3,747 14,730 Total $132,600