Sales Estimated Fixed cost Variable Fixed cost Total cost price Sales per unit cost $1.00 1,600,000 bags $400,000 $0.25 $0.40 $0.65 $2.00 800,000 bags $400,000 $0.50 $0.40 $0.90 The table shows the estimated sales for two different prices of bags of chips. Calculate the total profit when selling bags for $1 each.

Net profit is the amount of income that remains after all expenses have been met. The expenses may be fixed or variable in nature and must be reduced from Sales to arrive at the profit figures.