3-30 Choosing most profitable production volume. Answer the following questions. 1. Blanchard Company manufactures and sells dresses at a variable cost of $30 each and a fixed cost of x. It can sell 6,000 dresses at a selling price of $50 to earn an operating income of $20,000 or it can sell 3,500 dresses at a selling price of $60 and another 2,000 dresses at a selling price of $40. Which alterna- tive should Blanchard choose? 2. Canta Corporation manufactures and sells a special kind of ball bearing. Its cost structure depends on the number of bearings it produces. Its fixed costs and variable manufacturing cost per unit for differ- ent ranges of production are described in the following table: Production Variable Manufacturing Range in Units Fixed Costs Cost per Unit 1-3,000 $250,000 $75 3,001-6000 $350,000 $50 6,001-10,000 $750,000 $25 Canta's sales director believes the company can sell 2,500 units at a selling price of $300; or 5,000 units at a price of $200; or 8,000 units at a price of $175. If it chose to sell 8,000 units, however, it would incur additional advertising costs of $50,000 and variable selling costs of $5 per unit. Should Canta Corporation plan to produce and sell (a) 2,500 units (b) 5,000 units or (c) 8,000 units