Even though Pierce Grain Company manufactures several different products, it has observed over a lengthy period that its product mix is rather constant. This allows management to conduct its financial planning by using a “normal” sales price per unit and a “normal” variable cost per unit. The “normal” sales price and variable cost per unit are calculated from the constant product mix. It is like assuming that the product mix is one big product. The selling price is $10 and the variable cost is $6.

Total fixed costs for the firm are $100,000 per year. What is the break-even point in units produced and sold for the company during the coming year?