Based on the previous gross profit, and the gross profit after the purchase of the additional units, the effect would be a reduction of $200,000.
How would Moncrief Company gross profit be affected?
Gross profit before purchase of additional units:
= Sales - Cost of goods sold
= (35,000 x 60) - (35,000 x 30)
= $1,050,000
Gross profit after purchase of additional units:
= Sales - Cost of goods sold
= (35,000 x 60) - (20,000 x 40) - (15,000 x 30)
= $850,000
The difference is:
= 850,000 - 1,050,000
= -$200,000
Find out more on gross profit at https://brainly.com/question/20620035.
#SPJ1
