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What is the expected profit or loss of the product

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Reference no: EM132846607

Question - Sue Company is considering the production of a new product. Sue Company has the following data available:

Expected product life 4 years

Expected sales (units) over product life 2,000

Variable production costs $42 per unit

Variable selling costs $16 per unit

Annual fixed production costs $15,000

Annual fixed selling costs $5,000

Research and development costs $184,000

Selling price $200 per unit

Required - What is the expected profit or (loss) of the product over the product life cycle?

a. $20,000

b. $40,000

c. $204,000

d. $880,000

Reference no: EM132846607

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