Narchie sells a single product for $50. Variable costs are 70% of the selling price, and the company has fixed costs that amount to $374,400. Current sales total 20,000 units.

a) If Narchie sells 28,000 units, its safety margin will be:

Multiple Choice

• $152,000.
• $374,400.
• $1,248,000.
• $1,400,000.
• None of the answers is correct.

b) Narchie sells a single product for $55. Variable costs are 60% of the selling price, and the company has fixed costs that amount to $605,000. Current sales total 23,500 units.

In order to produce a target profit of $29,700, Narchie's dollar sales must total:

Multiple Choice

• $11,540.
• $30,767.
• $1,512,500.
• $1,586,750.
• None of the answers is correct.