Vander Belt Manufacturing, Inc., is considering reorganizing its plant into manufacturing cells. The following estimates have been prepared to evaluate the benefits from the reorganization:

	before the change	after the change
Total annual sales	$500,000	$750,000
Costs Percentage of sales:
Direct Materials	20%	17%
Direct Labor	8%	8%
Manufacturing support costs	17%	6%
work in process inventory	$150,000	$125,000

Inventory carrying costs are estimated to be 10% per year. 1. As a result of the layout reorganization, reduced levels of work-in-process inventory are projected to decrease inventory carrying costs annually by how much? 2. As a result of the layout reorganization, incremental manufacturing costs are projected change by how much? 3. As a result of switching to a cellular manufacturing operation, total benets are projected to increase annually by how much?