MSI's educational products are currently sold without any supplemental materials. The company is considering the...
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MSI's educational products are currently sold without any supplemental materials. The company is considering the inclusion of instructional materials such as an overhead slide presentation, potential test questions, and classroom bulletin board materials for teachers. A summary of the expected costs and revenues for MST's tvo options follows CD with Instructionsl CD Only Materials 9.000 units 39000 unis Estimated demand Estimated sales price Estimated cost per unit $35.00 S 50.00 Direct materials Direct labor Variable manufacturing overhead Fxed manufacturing owemead 6.75 9.25 3.00 2.25 9.50 34.25 44.00 5105,000 9.00 0.00 9.50 Unit manufacturing cost Accitional develocment cost Required: 1 Based on the given data, Compute the increase or decrease in profit that would result if instructional materials were added to the CDs ns CD Only Materials Incremental Sales Revenue Variable Cost Contribution Margin Additional Development Costs Differential Proft Loss) 2. Should MSI add the instructional materials or sell the CDs without tham? Sel the CDs without Instructional Materials O Add the Instructional Materials
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