Ivanhoe Company operates a small factory in which it manufactures two products: C and D. Production and sales results fo

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Ivanhoe Company operates a small factory in which itmanufactures two products: C and D. Production and sales resultsfor last year were as follows.
C
D
Units sold
8,900
19,500
Unit selling price
$93
$77
Unit variable costs
52
40
Unit fixed costs
21
21
For purposes of simplicity, the firm averages total fixed costsover the total number of units of C and D produced and sold.The research department has developed a new product (E) as areplacement for product D. Market studies showthat Ivanhoe Company could sell 11,700 units ofE next year at a price of $113; unit variable costs of E are $42.The introduction of product E will lead to a 12% increase indemand for product C and discontinuation of product D. If thecompany does not introduce the new product, it expects next year’sresults to be the same as last year’s.Compute company profit with products C & D and with products C& E.
Net profit with products C & D
$enter a dollar amount
Net profit with products C & E