Quiz 1 Time Limit: 1:15:00 Time Left:1:05:13 Jaleesa Ball: Attempt 1 Following a strategy of product differentiation, Ernsting Corporation makes a high-end computer monitor, CM12. Ernsting Corporation presents the following data for the years 2ex3 and 2ext: 2ex3 2ex4 Units of CM12 produced and sold 5,600 5,5ee Selling price $400 $440 Direct materials (pounds) 15,000 15,375 Direct materials costs per pound $40 $44 Manufacturing capacity for CM12 (units) 10,000 10, eee Conversion costs $1,000,000 Conversion costs per unit of capacity $1,100,000 $100 $110 Selling and customer service capacity (customers) 60 58 Total selling and customer service costs $360, eee $362,500 Selling and customer-service capacity cost per customer $6,000 $6,250 Ernsting Corporation produces no defective units but it wants to reduce direct materials usage per unit of CM12 in 2ex4. Manufacturing conversion costs in each year depend on production capacity defined in terms of CM12 units that can be produced. Selling and customer-service costs depend on the number of customers that the customer and service functions are designed to support. Ernsting Corporation has 46 customers in 20x3 and 50 customers in 20x4. The industry market size for high-end computer monitors increased 5% from 2ex3 to 2ex4. Requirement: Calculate the revenue effect of the growth component and the cost effect of the growth component