Ok! I'll take you through this step by step!
First, we need to add up what it costs to make the case. So...
Needle/Thread: $2.75
Felt: $1.29
Now add them together... and... he spent... $4.04!
Now he earned twelve dollars, so we have to subtract $4.04 from twelve to show his profits.
$12
- $4.04
--------------
$7.96
So his total profit was D.$7.96.
Hope this helps! Have a great day!