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Key Corporation is considering the addition of a new product. The expected cost and revenue data for the new product are as follows: Annual sales

Key Corporation is considering the addition of a new product. The expected cost and revenue data for the new product are as follows:

Annual sales 2,500 units
Selling price per unit $ 304
Variable costs per unit:
Production $ 125
Selling $ 49
Avoidable fixed costs per year:
Production $ 50,000
Selling $ 75,000
Allocated common fixed corporate costs per year $ 55,000

If the new product is added, the combined contribution margin of the other, existing products is expected to drop $65,000 per year. Total common fixed corporate costs would be unaffected by the decision of whether to add the new product.

At what selling price would the new product be just breaking even?

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