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Question 3 (8 marks) Gimble Manufacturing Inc. makes vibration control springs for heating, ventilating, and air conditioning (HVAC) equipment. Materials cost $52 per spring set,
Question 3 (8 marks) Gimble Manufacturing Inc. makes vibration control springs for heating, ventilating, and air conditioning (HVAC) equipment. Materials cost $52 per spring set, and the machinists are paid $44 per hour. A machinist can produce four sets of springs per hour. Fixed manufacturing costs for springs are $5,000 per period. Non-manufacturing spring set costs are fixed at $11,000 per period. Each spring set sells for $75 and Gimble sells on average 4,000 spring sets per period. Required: 1. Competition has entered the market and is selling spring sets for an introductory price of $66. Can Gimble Manufacturing meet this price and still make a profit? What is the profit or loss per unit (round to two decimal points)? 2. How would your answer to requirement a. change if Gimble sells on average 8,500 spring sets per period. What is the profit or loss per unit (round to two decimal points)
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