Use the following data for the next questions #6 to #8 : Laurel Supply Company...
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Use the following data for the next questions #6 to #8 : Laurel Supply Company makes specialized products for automobile applications. Recently management introduced a new patented engine sensor device. The first year costs and revenues for the product were as follows: Selling price.... .$400 per unit Direct materials $135 per unit Direct labor......... $ 45 per unit Variable manufacturing overhead (MOH). $ 40 per unit Total fixed MOH.......... $1,600,000 Variable selling and administrative....... $ 30 per unit Total fixed selling and administrative..... $500,000 Sales volume ...... ....... 25,000 units During the second year of production and sales, the company only sold 12,000 units of product, because a competitor produced and sold an identical product. Laurel Supply has filed a law suit against the competitor for patent infringement. 6. Assume the competitor is liable as alleged by Laurel Supply in the patent infringement law suit. What is the amount of damages that Laurel Supply experienced during the second year of the new product as a result of the competitor's patent infringement? $1,950,000 b. $2,535,000 $2,650,000 d. $2,080,000 a. c
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