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The Dubs Division of Fast Company (the parent company) produces wheels for off-road sport vehicles. Dubs has two products, 1 and 2. The two products

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The Dubs Division of Fast Company (the parent company) produces wheels for off-road sport vehicles. Dubs has two products, 1 and 2. The two products only differ in how they are marketed. Product 1 is sold in bulk to customizing shops, while Product 2 is sold directly to consumers. Dub's estimated operating data for the year follows. ..... Product 1 ..... Product 2 Sales Price $300 each.... ... $400 each Var Mfg $50 each .. $50 each Var G&A $40 each. $188 each Fixed Mfg $50,000 $50,000 Fixed G&A $60,000 $80,000 ... Unless otherwise stated assume the fixed costs given above are allocated costs and unavoidable. Currently the Dubs division has a total manufacturing capacity of 2,500 wheels per year. If the maximum external demand for either product separately is 1,500 units, how much would profits increase if two additional production workers were added? The new workers would not change the per unit variable manufacturing costs of either product. However, they would add a total of $17,000 in annual fixed manufacturing costs and increase capacity by 256 wheels (in total). Assume Dubs uses the additional capacity to maximize total profits, Round to the Nearest $1.00. If the additional workers decrease profits use a negative number, e.g.-2000. AWE

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