IS-1m. (BI'eak-even point and selling price) Heritage Chain Company wilJ produce 175,000 units next year. All of this production will be sold as finished goods. Fixed costs will total $335,000.

Variable costs for this firm are relatively predictable at 80 percent of sales.

a.ı If Heritage Chain wants to achieve an earnings before interest and taxes level of

$270,000 next year, at what price per unit must it sell its product?

b.ı Based on your answer to part (a), set up an analytical income statement that will verify your solution. .