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Carla Vista Company operates a small factory in which it manufactures two products: C and D. Production and sales results for last year were as

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Carla Vista Company operates a small factory in which it manufactures two products: C and D. Production and sales results for last year were as follows. For purposes of simplicity, the firm averages total fixed costs over the total number of units of C and D produced and sold. The research department has developed a new oduct (E) as a replacement for product D. Market studies show that Carla Vista Company could sell 11,900 units of Enext year at a price of $113; unit variable costs of E are $45. The introduction of product Ewill lead to a 11% increase in demand for product C and discontinuation of product D. If the company does not introduce the new product. it expects next year's results to be the same as last year's. Compute company profit with products C&D and with products C&E. Net profit with products C&D$ Net profit with products C&E$

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