Question: For the current year ending January 31, Ringo Company expects fixed costs of $178,500 and a unit variable cost of $41.50. For the coming year, a new wage contract will increase the variable unit cost to $45.00. The selling price of $50.00 per unit will remain the same.

Compute the break-even sales (in units) for the current year.

Compute the break-even sales (in units) for the coming year assuming the new contract is signed.

Please show steps because I'm not sure how they got the answer.