Sue Company is considering the production of a new product. Sue Company has the following data available:

Expected product life4 years

Expected sales (units) over product life.2,000

Variable production costs$42 per unit

Variable selling costs$16 per unit

Annual fixed production costs$15,000

Annual fixed selling costs$5,000

Research and development costs$184,000

Selling price$200 per unit

What is the expected profit or (loss) of the product over the product life cycle?

• $20,000
• $40,000
• $204,000
• $880,000