IPort Products makes cases for portable muslc players in two processes, cutting and sewing. The cutting process has a capacity of 155,000 units per year, sewing has a capacity of 180,000 units per year. Cost information follows. Demand is very strong. At a sales price of $23.00 per case, the company can sell whatever output it can produce. 1Port Products can start only 155.000 units into production In the Cutting Department because of capacity constraints. Defectwe units are detected at the end of production In the Cutting Department. At that point, derective units are scrapped. Of the 155,000 units started at the cutting operation, 23,250 units are scrapped. Unit costs in the Cutting Depanment for both good and defecthe units equat 516.10 per unit, including an allocation of the totat flxed manufacturing costs of $542,500 per year to units. The nxed cost of $3.50 per unit is the allocation of the total fored costs of the Cutting Department to each unit, whether good or defective. (The total fxed costs are the same whether the units produced in the Cutting Department are good or defective.) The good units fiom the Cutting Department are sent to the Sewing Department. Varlable manufacturing costs in the Sewing Department are $4.00 per unit and fixed manufacturing costs are 567.500 per yeat. There is no scrap in the Sewing Department. Therefore, the companys total sales quantity equals the Cutting Department's good output. The company incurs no other variable costs. The company's designers have discovered a new type of direct materlat that would reduce scrap in the cuiting Department to 7,750 units. Howevet, using the new material would increase the direct materlats costs to $10.00 per unit in the Cutting Department for all 155,000 untts. Recal that only 155,000 units can be started each year. Requlred: a. Compute profit under each alternattve. Assume that inspection and testing costs will be reduced by $32,500 if the new material is used. Axed costs in the sewing deparment witl remaln the same whether 131,750 or 147,250 units are produced. b. Shoukd IPort use the new material and Improve quality? Compute profit under each alternative. Assume that inspection and testing costs will be reduced by $32,500 if the new material is used. Fixed costs in the senving department will remain the same whether 131,750 or 147,250 units are produced. (Do not round intermediate calculations. Round "Price per unit" to 2 decimal places.) Complete this question by entering your answers in the tabs below. Should IPort use the new material and improve quality