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Question 6 10 pts ABC Company manufactures and sells a single product for $50 per unit. Variable costs are $40 per unit and fixed costs
Question 6 10 pts ABC Company manufactures and sells a single product for $50 per unit. Variable costs are $40 per unit and fixed costs total $160,000. During 2020, the company sold 25,000 units of this product to customers. The president of the company believes the following changes should be made in 2021 in order to improve the company's profitability: 1. increase the selling price of the product by 20% 2. automate a portion of the production process which will reduce variable costs by 5% per unit but will add an additional fixed cost of $12,000 per year 3. increase advertising by $26,000 Assume these changes are made. Calculate the number of units that ABC Company must sell in 2021 in order to earn a target profit equal to 33% of sales
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