A Project Has Expected Sales of 5,000 Units, a Selling

A project has expected sales of 5,000 units, a selling price of $29 a unit, variable costs equal to 60% of sales, fixed costs of $32,000, and depreciation of $9,500. Assume that total revenue can increase by 12%, variable costs can decrease to 58% of sales, and fixed costs can decrease by 5% in an optimistic situation. What would the pretax profits be, per year, if the optimistic situation should occur? Show your computations.

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