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The 98940-TH company sells its product for $25 per unit. The variable expenses are $15 per unit. The 98940-TH company sold 40,000 units last
The 98940-TH company sells its product for $25 per unit. The variable expenses are $15 per unit. The 98940-TH company sold 40,000 units last year and reported the following results: Sales (40,000 balls) Variable expenses Contribution margin Fixed expenses $1,000,000 600,000 400,000 265,000 Net operating income $ 135,000 The 98940-TH company considers reducing variable expenses per unit by 40% by investing in new equipment that would double the company's fixed expenses. If the new equipment is purchased, how many units will the 98940-TH company have to sell next year to earn the same net operating income, $135,000, as last year? Multiple Choice 41,563 units 48,625 units 47,313 units 42,875 units
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