Relevant Cash Flows [LO1] Winnebagel Corp. currently sells 20,000 motor homes per year at $97,000 each and 14,000 luxury motor coaches per year at $145,000 each.
The company wants to introduce a new portable camper to fill out its product line;
it hopes to sell 30,000 of these campers per year at $21,000 each. An independent
consultant has determined that if the company introduces the new campers, it should
boost the sales of its existing motor homes by 2,700 units per year and reduce the
sales of its motor coaches by 1,300 units per year. What is the amount to use as the
annual sales figure when evaluating this project? Why?