Exercise $3-32($Algo$)$ Basic Decision Analysis Using CVP $($LO $3-1)$

Grove Audio is considering the introduction of a new model of wireless speakers with the following price and cost characteristics.

Assume that the projected number of units sold for the year is $4,150.$ Consider requirements $($b$),($c$),$ and $(d)$ independently of each

other.

Required:

a$.$ What will the operating profit be$?$

b$.$ What is the impact on operating profit if the sales price decreases by $20$ percent? Increases by $10$ percent?

c$.$ What is the impact on operating profit if variable costs per unit decrease by $10$ percent? Increase by $20$ percent?

d$.$ Suppose that fixed costs for the year are $20$ percent lower than projected, and variable costs per unit are $10$ percent higher than

projected. What impact will these cost changes have on operating profit for the year? Will profit go up$?$ Down? By how much?

Complete this question by entering your$-$answers in the tabs below.

What will the operating profit be$?$