High Country Ski Company recently expanded its manufacturing capacity, which will allow it to produce up to 15,000 pairs of cross-country skis of the X model or the Y model. The Sales Department assures management that it can sell between 9,000 pairs and 13,000 pairs of either product this year. Because the models are very similar, High Country Ski will produce only one of the two models.

Per Unit (Pair) Data

X Model Y Model

Selling price $88.00 $80.00

Variable costs 52.80 52.80

Fixed costs will total $369,600 if the X Model is produced but will be $316,800 if the Y Model is produced. High Country Ski is subject to a 40% income tax rate.

If the fixed costs for Y model goes up by 10% but the variable costs for Y models goes down by 10%, what would the new breakeven point be?

A. 10,730

B. Unchanged

C. 7,333

D. 10,043