QUESTION 3 A manufacturer of high-performance pumps has the cost and profit data given in the following table. The company invests $1.2M in an aggressive two-year design and development program to increase sales by 20%. When this is completed, what will be the profit for the improved design case? Existing Design Improved design Sales price $500 $500 Units sold 20,000 Net sales $10M Direct labor $1.5M Materials $5.0M Overhead $2.0M Cost of product sold $8.5M Gross Margin $1.5M Total operating expenses $1.0M Pretax profit $0.5M % Profit 5% Please do not include % symbol with your