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Huynh, Inc. produces two product lines: Shorts and Long Pants. Product profitability is analyzed as follows: Shorts Long Pants Production and sales volume 66,000 units
Huynh, Inc. produces two product lines: Shorts and Long Pants. Product profitability is analyzed as follows: Shorts Long Pants Production and sales volume 66,000 units 21.000 units Selling price $16.00 $29.00 Direct material $1.00 $5.00 Direct labor $ 4.50 $8,20 Manufacturing overhead $ 2.00 $3.00 Gross profit $8.50 $12.80 Selling and administrative $4.00 $.700 Operating profit $4.50 $5.80 What is the projected decline in operating income if the direct materials costs of shorts increase to $3.50 per unit and direct labor costs of long pants increase to $14.00 per unit
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