Jaybird company operates in a highly competitive market where the market price for its product is $140 per unit. Jaybird desires a 30% profit per unit. Jaybird expects to sell 5,000 units. Additional information is as follows:
Variable costs per unit:
Direct materials: $23
Direct labor: $24
Overhead: $22
General and administrative: $28
Fixed costs (total):
Overhead: $45,000
General and administrative: $18,000
To achieve the target cost per unit, Jaybird must reduce total expenses by how much?
a. $48,500
b. $58,000
c. $59,500
d. $65,000
e. $68,000