Break-Even Sales Under Present and Proposed Conditions Darby Company, operating at full capacity, sold 137,300 units at a price of $123 per unit during the current year. Its income statement is as follows: Sales Cost of goods sold $16,887,900 5,986,000 Gross profit Expenses: Selling expenses $2,993,000 Administrative expenses 1,804,000 $10,901,900 Total expenses Income from operations 4,797,000 $6,104,900 The division of costs between variable and fixed is as follows: Variable Fixed Cost of goods sold 60% 40% Selling expenses 50% 50% Administrative expenses 30% 70% Management is considering a plant expansion program for the following year that will permit an increase of $1,476,000 in yearly sales. The expansion will increase fixed costs by $196,800, but will not affect the relationship between sales and variable costs.