Reference no: EM133036191

Question - Wyatt Industries sells overly complex multi-player strategy board games to accountants. The costs of printing the board game materials, manufacturing figurines and dice, and marketing the game at the firm's normal volume of 2,500 units per year are shown below. To arrive at the fixed costs per unit figures below, Wyatt divided total fixed costs by the normal sales volume.

Sales price $75

Direct materials 20

Direct labor 5

Variable overhead 2

Fixed overhead 9

Total manufacturing costs 36

Variable marketing costs 4

Fixed general & administrative costs 10

Total selling, general & administrative costs 14

Total unit costs 50

1) What is Wyatt Industries' annual profit in 2021, assuming that it achieves its normal sales volume?

2) In 2022, Wyatt's sales increase to 3,000 units due to increased demand for its games from tech startups. What is Wyatt's net profit for 2022, assuming that Wyatt's variable and fixed costs remain the same year-over-year?