IV. Production level, absorption costing, and gross margin Tramor Company reports the following cost data for its single product. The company regularly sells 20,000 units of it product at a price of $80 per unit. If Tramor doubles its production to 40,000 units while sales remain at the current 20,000 unit level, by how much would the companys gross profit increase or decrease under absorption costing? Direct materials.. $10 per unit Direct labor. $12 per unit Overhead costs for the year Variable overhead.. $3 per unit Fixed overhead per year $40,000 Normal production level (in units).. 20,000 units