Mendez Company manufactures a product that has a variable cost of $30 per unit. The company’s fixed costs total $750,000. Mendez had net income of $90,000 in the previous year. Its product sells for $50 per unit. In an effort to increase the company’s market share, management is considering lowering the product’s selling price to $46 per unit.
Required
If Mendez desires to maintain net income of $90,000, how many additional units must it sell in order to justify the price decline?