Stacy works for a small manufacturing company which makes only one product. The Christmas season accounts for 45% of annual sales. The product sells for $49 each. On January 2, the accounting department provided the management team with the following unit cost information based on Decembers results:

DM $10

DL 3

VOH 2

FOH 12

Total unit cost $27

Stacy was elated. We make a profit of $22 on every unit we sell. That means we have nothing to worry about. We are going to make lots of money no matter what.

Is Stacy correct? Explain your answer. Hi there, I am in my MBA program, this is an Analysis exercise of not more than 200 words, but I need to know what is to be calculated, and why is she wrong or right. I just finished studying the chapter for cost behavior! Thank you! Appreciate it!