Martin Company currently sells its products for

$230

per unit. Management is contemplating a

20

%

increase in the selling price for the next year. Variable costs are currently 40% of sales revenue and

are not expected to change next year (the company will still pay the same variable cost per unit).

Fixed expenses are $150,000 per year.

If fixed costs increase 10% next year, and the new selling price per unit goes into effect, how many

units will need to be sold to break even?

A)

165,000

units

B)

448

units

C)

897

units

D)

1,793

unit