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Windsor Design Inc, a high-fashion women's dress manufacturer, is planning to market a new cocktail dress for the coming season. Windsor Design supplies retallers in

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Windsor Design Inc, a high-fashion women's dress manufacturer, is planning to market a new cocktail dress for the coming season. Windsor Design supplies retallers in Toronto, Montreal, and the Atlantic provinces Fout metres of material are laid out for the dress pattern. After cutting some material remains, which can be sold as remnants. The company could also use the leftover material to manufacture a matching cape and handbag. However, if it uses the leftover material for the cape and handbag. more care will be needed in the cutting. and the cutting costs will therefore increase. The company expects to sell 1,400 dresses if a matching cape and handbagarenot available. Windsor Design'smarket research revoals, however. that dress sales would be 25\% higher if a matching cape and handbag were available. The market research indicates thot ifie cape andior handbag could not be sold individually but only as accessories with the dress. The various combinations of dopsef capes, and handbsgs that retallers will self areas follows: The material used in the dress costs $13.00 a metre, or $52.00 for each dress. The cost of cutting the dress if the cape and handbag are not manufactured is estimated at $22.00 a dress, and the resulting remnants can be sold for $5.00 for each dress cut out. If the cape and handbag are to be manufactured, the cutting costs will be increased by $10.00 per dress. There will be no saleable remnants if the capes and handbags are manufactured in the quantities estimated. The selling prices and the costs to complete the three items once they are cut are as follows: - Excludes cost of material and cutting. Calculate operating income if only the dress is cut and sold. Operating income Calculate operating income if the dress and accessories are produced and sold. (Round answer to 0 decimal places, es. 125.) eTextbook and Media

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