Sheridan Industries sells two electrical components with the following characteristics. Fixed costs for the company are $306,000per year.

XL-709

Sales price $27.00

Variable cost 23.00

Sales volume 61,200units

CD-918

Sales price $42.00

Variable cost 34.00

Sales volume 91,800units

How many units of each product must Sheridan Industries sell in order to break even?

Sheridan's vice president of sales has determined that due to market changes, the sales price of component XL-709 can be increased to $31.00with no impact on sales volume. What will be Sheridan's new breakeven point in units?

Returning to the original information, Sheridan's vice president of marketing believes that spending $91,800on a new advertising campaign will increase sales of component CD-918 to122,400units, without affecting the sales of product XL-709. How many units of each product must Sheridan sell to break even under this new scenario?

The market changes referred to in part (b) indicate additional overall demand for component XL-709. Sheridan's vice president of marketing believes that if the company spends $91,800to advertise component XL-709 rather than CD-918, as planned in part (c), the company will be able to sell a total of76,500units of XL-709 at the new price of $31.00. If the company must choose to advertise only one component, which component should receive the additional $91,800in advertising?