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This year Bertrand Company sold 42,000 units of its only product for $17.40 per unit. Manufacturing and selling the product required $127,000 of fixed manufacturing

This year Bertrand Company sold 42,000 units of its only product for $17.40 per unit. Manufacturing and selling the product required $127,000 of fixed manufacturing costs and $187,000 of fixed selling and administrative costs. Its per unit variable costs follow.

Material $ 4.70
Direct labor (paid on the basis of completed units) 3.70
Variable overhead costs 0.47
Variable selling and administrative costs 0.27

Next year the company will use new material, which will reduce material costs by 70% and direct labor costs by 30% and will not affect product quality or marketability. Management is considering an increase in the unit sales price to reduce the number of units sold because the factory

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