A company manufactures and sells one type of product. The budgeted data below are provided. Selling price $10 per unit. Sales volume 10000 units. Variable costs $5 per unit. Fixed costs $25000. The sales director has suggested a 20% cut in the product’s selling price. Variable costs will fall to $4 per unit. Sales volume would be expected to rise by 5%. What will be the new budgeted profit?
- A$15000
- B$17000
- C$20000
- D$27500