The marketing manager of Walton Corporation has determined that a market exists for a telephone with a sales price of $22 per unit. The production manager estimates the annual fixed costs of producing between 41,400 and 81,200 telephones would be $521,600.

Required

Assume that Walton desires to earn a $135,000 profit from the phone sales. How much can Walton afford to spend on variable cost per unit if production and sales equal 46,900 phones?