Fortune Inc. manufactures a single product for $140 per unit and sells it for $250 per unit. The sales staff receives a commission of 8% of sales. March's income statement follows. FORTUNE INC. Income Statement For Month Ended March 31 Sales (15,000 units x $250) Cost of goods sold (15,000 units x $140) Gross profit $3,750,000 2,100,000 1,650,000 Selling, general and administrative expenses Sales commissions expense (8% of sales) $ 300,000 Rent expense Advertising expense Office salaries expense Depreciation expense Interest expense 42,000 562,500 225,000 120,000 3,125 1,252,625 $ 397,3750 Total Selling, general and administrative expenses Net income Without any changes in strategy, management expects March's results to be repeated in April, May, and June. However, management believes that if the unit selling price is reduced to $230 per unit and advertising is increased to $620,000 per month, sales units will increase to 16,500 for April, 18,200 for May, and 20,000 for June. The unit cost of its product will remain at $140 per unit, the sales staff will continue to earn an 8% commission, and the remaining expenses will stay the same.