Summit Outdoor Gear manufactures and sells 7 different models of outdoor gear. Summit Outdoor Gear is contemplating a 4% price cut for all models. It expects the price cut to result in an 8% increase in units sold for models YY5101, YY5103, and YY5105. The other four models (YY5102, YY5104, YY5106, and YY5107) are expected to see a 5% increase in sales volume. Assess the impact of the price cut on Summit Outdoor Gear’s profits and prepare the equity statement.
•Model: YY5101
oSales Price: $85
oVariable Costs: $40
oSales Volume: 2,000
•Model: YY5102
oSales Price: $95
oVariable Costs: $45
oSales Volume: 2,500
•Model: YY5103
oSales Price: $105
oVariable Costs: $50
oSales Volume: 3,000
•Model: YY5104
oSales Price: $115
oVariable Costs: $55
oSales Volume: 3,500
•Model: YY5105
oSales Price: $125
oVariable Costs: $60
oSales Volume: 4,000