Fast Track Ltd sells only one type of plastic container for multi-purpose packaging. Data relating to the product for 2022 are as follows:

Selling Price per unit $25

Variable Manufacturing Cost per unit. $8

Annual Fixed Manufacturing Cost $240,000

Variable Selling and Distribution Cost per unit. $2.50

Annual Fixed Non-Manufacturing Coss $80,000

Profit $332,500

The CEO of Fast Track is currently under pressure from the shareholders to increase profit to $400,000 in 2023. (ignore tax

REQUIRED:

(a) Calculate the following:

1. . Number of units sold in 2022.
2. . Number of units that would have to be sold in order to reach the shareholders profit target in 2023 (assume no other changes).

(b) in order to reach the shareholders' profit target in 2023, the CEO is considering the following independent course of actions to increase profit:

1. . Increase selling price by 10%, with no other changes.
2. . Reduce total variable cost per unit to 36% of selling price, with no other changes.
3. . Reduce fixed cost by $70,000, with no other changes.

Calculate the profit to be earned under each alternative.