Question Completion Status: The Dubs Division of Fast Company (the parent company) produces wheels for off-road sport vehicles. Dubs is currently operating at its capacity of 4,000 units and in the next year they expect to produce and sell 2,000 units each of its two products, Pl and P2. Dubs estimates the demand for P1 to equal 2, 500 units per year and the demand for P2 to equal 3,000 units per year, at the current prices. By contract Dubs is required to supply 2,000 units of Pl to existing customers . Dubs also manufactures wheel (lug) nuts, one set of these items is a component part used in each of its products. A supplier has offered to sell Dubs all the of wheel nuts it would require for $25.7 per set. The accounting records for Dubs indicate the following additional information: Projected contribution margin Pl $175 per unit including $13.00 for one wheel nut set Projected contribution margin P2 $200 per unit including $13.00 for one wheel nut set Projected manufacturing fixed costs $200, 000 per year Projected G&A fixed costs $300, 000 per year Manufacturing costs of one wheel nut set: Direct Materials $9.00 Direct Labor $1. 00 Variable Mig. OH $3.00 At the current level of capacity, annual fixed manufacturing costs traceable to the production of wheel nuts amount to $40, 000 per year in total and mostly relate to rented machinery. If Dubs "out-sourced" wheel nut production to an external supplier its production manager estimates that Dubs could produce an additional 800 wheels (either Pl or P2) by reallocating staff and equipment currently used in wheel nut production. What is the total Divisional profit Dubs could earn per year by accepting the supplier's offer? Assume Dubs chooses its production schedule optimally. Round your solution to the nearest $1.00