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Answer the Following Questions Using the Information Below:
Tiger Pride

question 69

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Answer the following questions using the information below:
Tiger Pride produces two product lines: T-shirts and Sweatshirts. Product profitability is analyzed as follows:
 T-SHIRTS  SWEATSHIRTS  Production and sales volume 60,000 units 35,000 units  Selling price $16.00$29.00 Direct material $2.00$5.00 Direct labor $4.50$7.20 Manufacturing overhead $2.00$3.00 Gross profit $7.50$13.80 Selling and administrative $4.00$7.00 Operating profit $3.50$6.80\begin{array}{lrr}&\text { T-SHIRTS }&\text { SWEATSHIRTS }\\\text { Production and sales volume } & 60,000 \text { units } & 35,000 \text { units } \\\text { Selling price } & \$ 16.00 & \$ 29.00 \\\text { Direct material } & \$ 2.00 & \$ 5.00 \\\text { Direct labor } & \$ 4.50 & \$ 7.20 \\\text { Manufacturing overhead } & \$ 2.00 & \$ 3.00\\\text { Gross profit } & \$ 7.50 & \$ 13.80 \\\text { Selling and administrative } & \$ 4.00 & \$ 7.00 \\\text { Operating profit } & \$ 3.50 & \$ 6.80\end{array} What is projected operating income if direct materials costs of T-Shirts increase to $4.00 per unit and direct labor costs of Sweatshirts increase to $8.20 per unit?
-Using an ABC system,next year's estimates show manufacturing overhead costs will total $228,300 for 52,000 T-shirts.If all other T-shirt costs and sales prices remain the same,the profitability that can be expected is ________.

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