SALES REVENUE (5500 UNITS) $ 2,500,000.00 MANUFACTURING COSTS MATERIALS $ 150,000.00 VARIABLE COSTS $ 95,000.00 FIXED COST $ 150,000.00 DEPRECIATION $ 168,000.00 TOTAL MFG COST $ 563,000.00 MARKETING AND ADMINISTRATION COSTS: VARIABLE MARKETING COSTS $ 24,000.00 MARKETING DEPRECIATION $ 32,500.00 ADMINISTRATIVE FIXED COST $ 55,600.00 ADMINISTRATIVE DEPRECIATION $ 13,500.00 TOTAL MKT AND ADMIN $ 125,600.00 TOTAL COST $ 688,600.00 OPERATING PROFITS $ 1,811,400.00 DEPRECIATION CHARGES ARE FIXED, OLD MFG EQ WITH DEPRECIATION OF 15K WILL BE REPLACED WITH NEW EQUIPMENT OF 28K WITH 4 YR LIFE NO SALVAGE. SALES VOLUME WILL INCREASE BY 14 PERCENT AND SALES PRICE WILL INCREASE BY 2 PERCENT. MATERIAL COST IS EXPECTED TO GO DOWN MY 3 PERCENT. VARIABLE MARKETING COST WILL DECREASE 2 PERCENT. A MACHINE IN ADMINISTRATION WITH YEARLY DEPRECIATION OF 3K WILL BE SCRAPPED WITH NO BOOK VALUE LEFT. ADMINISTRATION FIXED COST WILL BE REDUCED BY 6 PERCENT. PREPARE A NEW FORECASTED INCOME STATEMENT REFLECTING THE ABOVE CHANGES.