The Officers of the Company reviewed the profitability of the company's four products and the potential effect of several proposals for varying the product mix. An excerpt from the year's income statement and other date follows:

-----------------------Product------------------------------
	Total	P	Q	R	S
Sales	P62,600	P10,000	P18,000	P12,600	P22,000
Cost of Goods Sold	44,274	4,750	7,056	13,968	18,500
Gross Profit	P18,326	P5,250	P10,944	P(1,368)	P3,500
Operating Expense	12,012	1,990	2,976	2,826	4,220
Profit before income tax	P6,314	P3,260	P7,968	P(4,194)	P(720)
Units Sold		1,000	1,200	1,800	2,000
Sales Price Per Unit		P10.00	P15.00	P7.00	P11.00
Variable Cost of goods sold per unit		P2.50	P3.00	P6.50	P6.00
Variable operating expense per unit		P1.17	P1.25	P1.00	P1.20

The total fixed cost is not expected to fluctuate as a result of changes under consideration.

Required:

1. The effect on profit if R is discontinued.

2. The effect on profit if R is discontinued and if a consequent loss of customers causes a decrease of 200 units in sales of Q.

3. The effect on profit if R's sales price is increased to P8, and the number of units sold decreases to 1,500 with no effect on the other products.

4. The effect on profit if a new product, T, is introduced and R is discontinued with no effect on the other products. (The total variable cost per unit of product T would be P8.05, and 1,600 units can be sold at P9.50 each. The plant in which R is produced can be utilized to produce T.)

5.The effect on profit if production of P is reduced to 500 units (to be sold at P12 each) and if production of S is increased to 2,500 units (to be sold at P10.50 each). (part of the plant in which P is produced can easily be adapted to produce S, but changes in quantities make changes in the sales price advisable.)

6. The effect on profit if production of P is increased by 1,000 units to be sold at P10 each by adding a second shift. (Higher wages must be paid, thus increasing the variable cost of goods sold per unit to P3.50 for each additional unit.)